Dec 20, 2012|
Treasurer Steve Grossman
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Junior looks like the -- taken a little bit of a downturn see the Dow down eight points -- -- a little bit of red on the board in front of -- that area and -- what that's. What's moving the markets in the ads but we've got the Dow down eight NASDAQ is down -- US and 480s now. -- say in response to the shootings in Newtown Connecticut. Massachusetts state treasurer has suggested that the Massachusetts pension plan review its investment holdings in gun manufacturers. Steve Grossman is the treasurer of the state of Massachusetts and joins us now on the financial exchange -- more -- In morning very exciting -- critical at this point -- the -- haven't had -- -- The -- days which. But only seven -- -- if that year the public pension fund and complete their work I am not very happy it's the only green between now discovered 31. Seattle maybe we'll get a Santa Claus -- who knew the it it sure hasn't been a rally in gun manufacturing stocks are down about 20% in the last three days. You have suggested. That now quote if I may. You can never leave out that discussion. How you are responsive to the values of the people of Massachusetts. You're referring of course to the shootings in Newtown Connecticut. And the fundamentally the job of that public pension funds which I chair the board is to maximize shareholder return. And could be could -- she Ares -- at all times. But the same time. Of the people that come off a pretty clear what their values aren't we and we -- all of our proxy voting guidelines. Year and a half ago. We took into -- companies that each and environmentally unsound practices predatory lending. And we do vote strongly. Favor or not and paper companies and their management teams that -- on how they act and behave in this particular case. I sent to Michael truck yet been active director. -- like that but we're gonna be getting. Innumerable inquiries from a legislature. Legislature's prerogative. The decide when and we shouldn't. Couldn't adapt are -- for market for electric speaker -- very clear over the years. Africa. A backhoe there are -- Iran when we were. -- that -- -- -- -- companies that were engaged in the oil and gas business helping Iran develop a weapons. The legislature. I'm I'm Eric direct that at -- We don't nine out companies -- -- -- that the company all over the world. How much doctors haven't how much stock in gun manufactures DSL. Well we act and I'm not sure because it would only say that I expect to my team at random. Let's analyze it let's start with gun manufacturers the obvious people but that also to a deeper in the -- apple. If there -- a European company -- -- company that makes armor piercing bullets. Used on the streets to kill people. Then crept back should be included realm combat action so I'm not. I'm in the Caitlin and let the -- anybody who really done that got me acting partner. Because blog where I need appropriate weapon and that the military. But let you know at least what we call and -- revive a legislature. -- into the commonwealth nonprofit. Advocacy groups order inquire about and everybody else. That's a partner with timely accurate and relevant and what we own and then we can think. Together as a society. It's -- and I understand maybe the doesn't that -- if you're avoiding tobacco stocks are gaming stocks are gone manufacturing stocks. Doesn't that make it tough on the managers to meet their investment objective because. The air -- you guys are underfunded so on one hand your slap an arm around saying hey I need better returns because you that's your job that is your mandate to give strong returns for that forty billion dollar fund. But then on the other side of the equation you're saying -- don't don't invest in an alcohol company -- don't invest in tobacco company isn't that. 88 unit that that strikes me as not being evenhanded. Well. Again you know -- never did. Items that state pension fund leadership's. Position and responsibility. To. Go -- decide unilaterally. We should do this we should -- that the legislature. Doesn't -- and get involved because they feel as elected representatives of the people com while. And I'm extreme situations. And Iran is developing. Your weapons. And South Africa and a part being practiced that we should not own company. -- in certain things and certain art world is not done often. It's done and rare situation. I would counsel that it could be used rarely. But nevertheless. The legislature may very well. I'd take action in limited situations here and I think they -- they come to -- say what you own you know. What are you alone I think we have to be able Ellen what we -- under the edit -- this issue. Be public in terms of what we do and don't own. There's going to be a public discussion about gun laws -- an investment would you -- But cerberus. The owner breeder and group. He -- eight. Almost immediately they were gonna -- and -- There wanna own a company that manufactured the gun. That killed. Those children. That's -- I understand -- Steve shouldn't you be less concerned about the legislature and more concerned say about the firefighters union or the state troopers I mean. It's it's not the legislature's money it's the it's a cop. Like engines dad is a is a retired cop. That ill what are you hearing from the the the police officers union at state troopers or the firefighters teachers with their perspectives it's it's their money it's not it's it's not. It is it it's it's not the legislature's money. I hear you loudly clearly and our concern is how do you maximize return. Mean look we're having a decent year this year November were up by eleven recorder percent number -- -- strong but it could take a lot of really -- years before we can view it. That Bart and current pension obligations. At the same time while. We haven't heard yet only a few days and that into account. -- -- Potentially going to hear from the citizens there represented as those unions that represent those are teachers and those. Firefighters -- where we and we -- -- and there may feel strongly that we take action at all I'm saying is that. Is that for the legislature it is the legislature's prerogative. They represent the people the commonwealth. They'll have a public debate -- -- -- on -- topic because people at the buy it in fact that legislation opera I'm not even go to protect it's gonna happen and leave it. We have an obligation collect and -- what we own. In the car manufacturing. -- producing. Ammunition producing arena and provide that information anybody who wants it. As a public service. Public entity and then. The action will be taken you and I can't predict but I think failure act like genocide are holding. Those who weren't as it and it. Would beer at -- our responsibility. I'm not posing. But investment strategy -- much as I'm saying we have an obligation. But I didn't nation and many people who want it is going to be -- huge topic of conversation amongst -- -- went for the year comes I think the representatives supposed. Men and women who other retirees are put away in one way or another and clearly -- -- maximize the return. People messes that have spoken time and time again on issues that may. Not always. Comport with the maximum of that moment and I think we -- to eat and insensitive and thoughtful about that without necessarily advocating a particular strategy. All right Steve thank you very much for your time we appreciate it very Steve Grossman state treasurer of Massachusetts joining us today. His perspective on the pension fund I'd love to talk to the cops that's you know the it adds up to get their perspective. On this it's their money. You know the V these guys in the I hate the fact that the legislature has any say in this at all a lot of people do it should be the teachers should be if it's not that it's not the legislature's money. In I think people forget that -- next -- to talk about bargains Christmas bargains it is not too late June -- at some tips for.