PALMETTO -- In an investment review, Charley Mulfinger, from Graystone Consulting, delivered a report that pretty much reflected the current conditions of the stock market. The third quarter showed no improvement from May to September and there was actually slower growth than anticipated. The sluggishness seemed to come from slow consumer spending which is 60 percent of the U.S. economy. The Dow: down 11.5 percent; growth: down 13.5 percent; and consumer discretionary spending: down 13 percent.
Mulfinger said he felt that the market was nervous about Europe, but that some relief has come from the IMF assisting Italy and Spain. He added that signs of improvement have started to show in the month of October and that US companies are reporting great earnings.
On September 22, the value of the city's holdings were $8,348,000 -- up 2.4 percent.
Mulfinger brought in and passed out copies of what he called "educational pieces." It was a Brinson Study, on how asset allocation rather than stock picking or market timing, is by far the most important factor that determines the returns that a portfolio will generate over time. He recommended one of the city's managers be moved from the eight managers currently directing the city's holdings. Holdings currently being managed by Renaissance will be moved to Polen Capital Management, a heavily concentrated (only 16 stocks) asset management firm. -- Motion to move holdings from Renaissance to Polen -- Approved, Unanimous.
-- Motion to approve payment of DROP retirement benefits to Patrick N. Douglas and Curtis L Mathis -- Approved, Unanimous.
-- Discussion of RFP process -- The Request For Proposal process is one of due diligence. The Board of Trustees hasn't performed one in 13 years. Chair, Ray Dielman, felt it may be time to do so. "It's our responsibility to those we represent." Attorney Scott Christiasen asked if there was any particular reason, because there is usually a motive or basis by which one is requested. All of the trustees weighed in on whether they felt the expense and time consumed to perform one was necessary.
The general consensus was there were no red flags to suggest either Scott Christiasen (Trustee Council) or Charley Mulfinger (Trustee, Finical consultant) were incompetent, or that any of the trustees were unhappy with their performance. They actually expressed their satisfaction with the work done by both, yet wanted to reassure those they represent see some due diligence.
Next Meeting -- February 27, 2012
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