Category Archives: Investment management

Public Pension Fund Study: High Fee Strategies Like Private Equity Lose Billions Compared to Cheaper Alternatives

A recent report slammed public pension funds for losing money relative to what they could have done by investing in high fee strategies like private equity. And that’s even before incorporating the fact that private equity returns are overstated.

Why You Should Care About CalPERS’ Staff’s and Board’s Incompetence in Private Equity and What You Can Do About It

Why you need to help CalPERS kick its bad private equity habits.

CalPERS Board Members Defend Poor Performance by Staff, Capture by Private Equity

“It’s shocking to see how many of the CalPERS investment committee are utterly ignorant. Aren’t these people supposed to know something? “

How CalPERS’ Consultant, Pension Consulting Alliance, Promotes Intellectual Capture by Private Equity

One of the not-well-recognized channels by which private equity orthodoxy, meaning general-partner-favoring party line, is propagated and defended is via private equity consultants. CalPERS’ consultant, Pension Consulting Alliance (PCA), performed this role during the most recent Investment Committee meeting.

CalPERS’ Senior Investment Officer Flouts Fiduciary Duty by Refusing to Answer Private Equity Questions

In the last CalPERS Investment Committee meeting, one of the most revealing incidents took place when Investment Director Christine Gogan repeatedly refused to answer a simple, direct question about a widely-used private equity tax abuse, management fee waivers.

CalPERS’ Chief Investment Officer Invokes False “Superior Returns” Excuse to Justify Fealty to Private Equity

In the last Investment Committee meeting, CalPERS’ chief investment officer Ted Eilopoulos invoked the One Excuse That Rules Them All for investing in private equity. It happens to be bogus.

CalPERS, an Anatomy of Capture by Private Equity

One of the strongest, most consistent reactions of experts who watched the video of the last meeting of CalPERS’ Investment Committee was that the staff and the Investment Committee members, save JJ Jelincic, were completely captured by the private equity industry.

Fortune’s Dan Primack Takes Up CalPERS’ Private Equity Scandal, Calls Head of Private Equity “Factually Wrong”

Dan Primack of Fortune has weighed in on what he calls the private equity “mess” at CalPERS, in an important new story, “CalPERS still can’t get out of its own way on private equity.”

Congressional Black Caucus Still Trying to Hurt Their Constituents By Killing the Labor Department Fiduciary Rule

Last year, the Huffington Post published the definitive take on the Congressional Black Caucus’ frequent sellouts to Wall Street, and how Maxine Waters has attempted to shut it down. Their public image as the conscience of the Congress belies a coziness with bank lobbyists and an open willingness to do their bidding. Ten CBC members […]

CalPERS Chief Investment Officer Defends Tax Abuse as Investor Benefit

CalPERS Chief Investment Officer made statements to the Investment Committee that are demonstrably false. As a video of the August Investment Committee meeting shows, Eliopoulos apparently does not grasp how a common tax avoidance scheme by general partners is not beneficial to limited partners. Even worse, he failed to mention that the IRS has recently proposed rules to end this tax abuse.

CalPERS Staff Demonstrates Repeatedly That They Don’t Understand How Private Equity Fees Work

The oversimplifications, mistakes, and refusals to answer basic questions by CalPERS staff members at the last Investment Committee meeting of its board suggest that CalPERS has so little understanding of private equity that it cannot responsibly invest in that strategy at all. These errors related to concepts that are fundamental to understanding the economics of a private equity investments and hence to negotiating them.

Senior Private Equity Officers at CalPERS Do Not Understand How They Guarantee That Private Equity General Partners Get Rich

Over the course of the last Investment Committee meeting of the CalPERS Board of Directors, many of the statements made by senior members of CalPERS’ investment staff showed a lack of understanding of basic issues, such as the industry’s economics and how widely-used contract terms operate.

CalPERS’ Private Equity, Exposed: Executive Summary

Senior private equity professionals at CalPERS do not understand the economics of private equity funds, raising questions about the staff’s competence.

You Don’t Need to Hire Rapacious Private Equity Firms to Get Their Returns

A new paper by Brian Chingono and Dan Rasmussen shows how to beat the average private equity fund’s return by a solid margin.

The Decline in Market Liquidity

While the Fed isn’t worried about the fall in market liquidity, experts argue that if investors make abrupt changes in their portfolios, the lack of liquidity could produce a crisis.