Posted on 10/26/2009 2:30:31 PM PDT by NormsRevenge
Remember the old saying, "Once burned, twice shy"? It's supposed to mean that when one has a bad experience, one should be more cautious in similarly dangerous circumstances.
California got burned in the early 1990s when Leon Black, fresh off a career with the scandal- tainted Drexel Burnham Lambert junk bond shop, set up his own investment firm and persuaded the state's new insurance commissioner, John Garamendi, to seize a supposedly insolvent Executive Life.
Executive Life had a fat portfolio of junk bonds that Black had helped assemble, and Garamendi allowed him to broker a deal with some French buyers who, it turned out, had illegal backing from a French government bank.
Many of the company's annuitants got burned and many years of litigation and investigations followed, but Black walked away with a reported billion-dollar profit for moving some paper.
It was a nice grubstake as Black built his firm, Apollo Management, into a financial powerhouse whose holdings, valued at around $40 billion, include AMC Entertainment, Harrah's Entertainment, Norwegian Cruise Line, Coldwell Banker and Century 21 Real Estate.
Black, it would seem, concluded that California's clueless officials were sources of easy money and by and by, set his sights on the California Public Employees Retirement System (CalPERS), the nation's largest pension trust fund.
CalPERS is run by a claque of politicians and directors who mostly come from public employee unions. And it hasn't exactly posted a sterling investment record lately, having lost about $100 billion in often speculative investments, such as a $1 billion haircut on Southern California land.
It appears that many of CalPERS' investments were arranged by middlemen, including ex-politicians and ex-members of the CalPERS board, who had developed relationships with those who made investment decisions.
(Excerpt) Read more at sacbee.com ...
Sounds like Oregon PERS got investment ideas from CalPERS.
Oregon lost 17B last year.
Fat, easy target of opportunity. Another great benefit of having clueless bureaucrats with no accountability running things/s.
I think the view is - it’s not immoral to steal from the Gov’t. Because the money is there, and its going to be lost, transferred, stolen or mismanaged away regardless, so it may as well be me who takes it.
Like punching someone in the dark - it’s a victimless crime. (sarc)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.