City Pension Portfolio Plunges Below $4 Billion; That's Lower Than Level of Mid-2006

The portfolio assets of the San Diego City Employees' Retirement System have plummeted to an unaudited figure of $3.92 billion, according to a report given Oct. 14 to members of the San Diego Retired Employees' Association, which consists of City retirees. Those retirees were told by the group's president that the fund is down $859 million, but the date of the beginning of that decline was not clear. However, the fund ended June 30, 2007 at $4.68 billion. It ended June 30, 2006 at $4.01 billion. Ergo, it is below the level of mid-2006 if the report is accurate. As of May 30 of this year, 38 percent of the fund was in U.S. stocks, 17 percent in foreign stocks, 30 percent in U.S. fixed income (mainly bonds), 4 percent international fixed instruments and 11 percent real estate. U.S. stocks are down more than 40 percent in this bear market and foreign stocks are down a bit more, so this decline is consistent with the overall market environment. Doug McCalla, chief investment officer of SDCERS, would not comment, deferring to a spokesperson. The SDCERS spokesperson did not get back within a reasonable time.


Doug McCalla, chief investment officer of SDCERS, would not comment, deferring to a spokesperson.

Of course he is not going to comment-the fund is bankrupt. It is BK on a cash flow and asset liability basis.


There is no way around it now-there is no way we are getting out of this-the San Diego pension's goose is cooked.

Just a matter of time before San Diego files BK. I predict KFC Sanders will continue on with the same path he has followed the last 4 years-pass the buck, no leadership no solutions.

I have a C note that says Sanders just rides this financial tsunami out until he leaves office forcing the next Mayor to file BK......any takers on that action??????

Response to post #1: Mayor Sanders said this year's deficit will be $43 million. That's typically optimistic. Steve Francis said that if revenues don't grow in the next 18 months (a probability), the deficit will be $128 million in 2010. That's probably optimistic, too. Best, Don Bauder

Response to post #3: As we all know, there is no way ALL the Republicans will be kicked out. So Fox TV will have some audience left. Best, Don Bauder

Response to post #2:

It's hopeless, our U-T Establishment Puppet-Mayor Sanders is not only corrupt but he is criminally negligent, and his out of control failures in leadership are BKing San Diego just like Bush-McCain-Republican Party is BKing the American economy.

If every republican politician in America isn't kicked out of office America shall most certainly go into Depression due to their politics of corruption and hate that have been destroying the American Way of Life, Economy and Opportunities for eight years.

We fought and won against fascism and communism, but republicanism is turning out to be the greatest threat against America in our history.

Response to post #4:

Damn, you're right as usual.

OK, how about putting them all in Fox Hell, making a new level of Dante's hell and damnation just for republican politicians and judges :)

This pension mess is serious business. Calpers has lost so much money that they are going to REQUIRE MORE money from the local muni's.

You thought we had cash flow problems before the financial meltdown, now we really have them.

Don, you wrote:

"Doug McCalla, chief investment officer of SDCERS, would not comment, deferring to a spokesperson. The SDCERS spokesperson did not get back within a reasonable time."

Um, aren't they supposed to be working for the City of San Diego?

Could the sad truth be that they have no idea what the investments are currently worth? Or are they willfully holding information back until after the election? The Sanders Administration has an official policy of NOT talking to the press, especially The Reader without the Mayor's express approval.

So why not cut out the middle man and just call your former colleague and current Sanders mouthpiece Gerry Braun and ask for the Mayor's spin on the pension fund losses? He's paid $140k a year to answer your questions.

Don, please continue to post about this. I cannot think of any local financial story of greater importance.

Thank you, again, for all your diligence in bringing the truth to light.



Response to post #5: Were you really thinking of Fox Hill and Fox Hole? Best, Don Bauder

Response to post #6: Right you are: CalPERS woes will rumble right through the California economy. Best, Don Bauder

Response to post #7: The Sanders administration does not talk to me or Matt Potter, or anybody at the Reader, although it responds to official requests for documents under California law. We have secret sources within the administration who can't be quoted but give us information. Bill Sheffler, a board members of SDCERS, is valiantly trying to introduce transparency to the operation. But he will have to alter a culture radically. Best, Don Bauder

Don, so if I've got this right, you're saying that SDCERS outperformed the market over the time frame from June 30, 2006 until now. I don't think it's any big secret that the system was going to lose value in this market. But... only a small portion of those funds are needed now. The rest may be invested for the long run, in which the market will likely gain back much of what it has lost. Looking at the big picture, SDCERS lost much less than the market as a whole.

Response to post #10:

This whole local and national political-economic scenario is looking more and more like an old Barnum & Bailey Freak Show.

Nationally the sideshow features Bush + McCain + Palin + Paulson running amuck like deranged inmates in a nuthouse with not one brain among them.

While locally we have the U-T Freak Show featuring the U-T Editorial Board’s Kittle as the demented Jesse James with a pile of strings in his claws tied to Sanders + Goldsmith + Dumanis and other inmates demonically sacking taxpayer funds while pouring fuel on the fires.

Response to post #11: No, I am not saying that SDCERS outperformed the market over that time frame. SDCERS is only 38 percent domestic stocks. One would have to compare SDCERS with other pension funds with similar asset mixes over that period. That information is available, but I haven't gone to it. Best, Don Bauder

Response to post #24: That would make a great Renaissance painting. Best, Don Bauder

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