Why would you want to put your money in anything lacking in trust, integrity, or direction?
What goes up most come down. What goes up rapidly, if it follows the normal laws of physics, comes down rapidly, too. Recall the junk bonds and the dot-coms. Real Estate is no different.
As far as investments go, the prudent pundits will tell you to "buy low, sell high." Villaraigosa’s plan to invest pension fund money in subsidizing low income housing may not be well thought out.
At first glance, the plan seems like a real loser. Force pensioners to invest a portion of their pensions to entice the poor to buy into an already high balloon-ready-to-pop housing market. At second glance, it is a real loser – “buy high, sell low." When interest rates go up, buyers will run and hide. Consistent with current city government fiscal policy, this market is good for spending as long as it’s somebody else’s money. It begs to ask whose interests are being served. Way too many eggs in the labor, building, construction, and real estate basket.
What investor in his or her right mind would invest in Los Angeles when the experts advise otherwise? The contenders for Los Angeles City Mayor, James Hahn and Antonio Villaraigosa, both self-bonified experts, seasoned and knowledgeable political leaders, and manipulators of Los Angeles city policy, openly agree the City lacks trust, integrity, and direction. Not to mention alleged rampant city corruption, State and Federal investigations, or that they are the purported leaders of the parade driving big business investors out of town. Again, all that aside, with all the other available choices, why would you want to put your money in anything lacking in trust, integrity, or direction?
It seems to me that rather to invest in an over-priced and over-speculated residential market, it would be better to invest in creating a better climate for businesses and education to help us sustain or, at least, minimize the effects of the bust that follows an oversold housing market. Without employers, entrepreneurs, and an environment conducive to supporting them, e.g. an educated workforce and a consistently business friendly city government, one should anticipate turning the housing market into a glut of foreclosures.
Here are some comments from Vince Foley, Chair of the Retirees' Health Care and Benefits Committee DWP Retired Employees' Association. Foley is an ethical and trusted former manager at DWP. It is good to see he remains outspoken and an advocate of prudent fiscal policy and common sense. He is sorely missed at DWP. Vince Foley’s letter follows.
Let's see, leverage the City's pensions to fund more union construction... Of course, with Mayor James Hahn's record of cookie jar raiding, union bias, and condoning management-orchestrated employee retaliation at DWP, no one is saying Hahn won't do the same thing.
As far as investments go, the prudent pundits will tell you to "buy low, sell high." Villaraigosa’s plan to invest pension fund money in subsidizing low income housing may not be well thought out.
At first glance, the plan seems like a real loser. Force pensioners to invest a portion of their pensions to entice the poor to buy into an already high balloon-ready-to-pop housing market. At second glance, it is a real loser – “buy high, sell low." When interest rates go up, buyers will run and hide. Consistent with current city government fiscal policy, this market is good for spending as long as it’s somebody else’s money. It begs to ask whose interests are being served. Way too many eggs in the labor, building, construction, and real estate basket.
What investor in his or her right mind would invest in Los Angeles when the experts advise otherwise? The contenders for Los Angeles City Mayor, James Hahn and Antonio Villaraigosa, both self-bonified experts, seasoned and knowledgeable political leaders, and manipulators of Los Angeles city policy, openly agree the City lacks trust, integrity, and direction. Not to mention alleged rampant city corruption, State and Federal investigations, or that they are the purported leaders of the parade driving big business investors out of town. Again, all that aside, with all the other available choices, why would you want to put your money in anything lacking in trust, integrity, or direction?
It seems to me that rather to invest in an over-priced and over-speculated residential market, it would be better to invest in creating a better climate for businesses and education to help us sustain or, at least, minimize the effects of the bust that follows an oversold housing market. Without employers, entrepreneurs, and an environment conducive to supporting them, e.g. an educated workforce and a consistently business friendly city government, one should anticipate turning the housing market into a glut of foreclosures.
Here are some comments from Vince Foley, Chair of the Retirees' Health Care and Benefits Committee DWP Retired Employees' Association. Foley is an ethical and trusted former manager at DWP. It is good to see he remains outspoken and an advocate of prudent fiscal policy and common sense. He is sorely missed at DWP. Vince Foley’s letter follows.
March 29, 2005Civil Action Press thanks you, Mr. Foley.
Dear DWP Retiree,
I watched the L.A. mayoral debate last night between Mayor Jim Hahn and Councilman Antonio Villaraigosa. I don't live in the City of L.A., but we are all interested in the future of the DWP, and specifically our Retirement Plan and our health plan coverage. The Mayor can certainly have an effect on our financial security.
In that light, a statement made by Villaraigosa last night scared
the bejeebers out of me. When discussing his plans if he is elected mayor, he included "...using pension funds to invest in housing initiatives in the City". Luckily I have TiVo, so when I heard that statement, I was able to "rewind" and listen to it three times so I wouldn't misquote him.
That scheme first raised its ugly head many years ago when then-Governor, Jerry Brown, sponsored legislation requiring all public pension plans in California to invest 25% of their portfolios in low-income housing. We were able to dodge that bullet because the State Legislature had no control over chartered-city pension plans. The next time we heard that scheme was just a few years ago when DWP General Manager, David Freeman, invited State Treasurer, Phil Angelides, to a DWP Retirement Board meeting to discuss his similar proposal to invest in low-income and affordable housing. Fortunately, the Retirement Board listened politely, then went about its business and ignored the proposal. Those were State officials trying to raid our Retirement Plan. Now we have someone a heck of a lot closer trying the same thing.
Low-income and affordable housing are noble pursuits, but should not be funded on the backs of retirees.
Even though you may not live in the City of L.A., you might have friends and relatives that can vote; make them aware that Villaraigosa wants to mess with our future!
Vince Foley, Chair
Retirees' Health
Care and Benefits Committee
DWP Retired Employees' Association
Let's see, leverage the City's pensions to fund more union construction... Of course, with Mayor James Hahn's record of cookie jar raiding, union bias, and condoning management-orchestrated employee retaliation at DWP, no one is saying Hahn won't do the same thing.
posted by The Gadfly at 12:02 AM
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