Changes to Investment Fund Rules Worrisome.

Some time back I received a newsletter from the University of California Retirement System ( UCRS ). The lead article proudly proclaimed that UCRS had completed divestiture of all fossil-fuel stocks.

What? They walked away from the likes of Exxon, Gulf, and Mobile? Halliburton and Schlumberger? Those are some serious heavy-hitters in the stock market and generally excellent income providers. I was not pleased by UCRS playing social justice warrior with my retirement funds, especially without my getting the slightest say in that decision.

I did post my concerns on the "LLNL - The True Story" blog and ran up against a number of posters that attacked my questioning the wisdom of the fund managers. One post suggested ( without humor markers ) that I should lose all UCRS benefits until I conform to the "California mindset".


Still, the question remains of how UCRS plans to replace the loss of revenue caused by divestiture - their role is supposed to be making money for retirees.

Now I see that the Biden administration is actively pushing rule changes for investment funds that encourage dabbling in so-called environmental, social, and governance investing ( ESG ).  Financial writers are raising alarms about these changes - Rules threaten your retirement savings .

Is ESG investing worrisome to you? Are you willing to forego significant growth in your retirement funds to satisfy some social cause? Do you want a vote in whether your retirement money is used in this manner?

Comments

  1. GreggS17/2/23 23:40

    Some good new for once.

    The new Republican-led House of Representatives caught wind of the proposed changes to rules for investment managers and told the White House, "Hell No..." Backing up this statement is some legislation forbidding this kind of rule change. It's rare to see something good for the little guy these days. If you like this kind of legislation then exercise your rights and send your congresscritter an e-mail or give them a call. Noise from us peasants does tend to motivate people in Washington D.C., so let's make some noise.

    ReplyDelete
  2. GreggS18/3/23 01:14

    Several days earlier the Silicon Valley Bank experienced a run on deposits and subsequently has failed. I note without glee that the managers of that institution had ignored normal bank procedures, instead managing the bank funds using environmental, social, and governance investing policies. Which has led to literally billions of dollars lost in depositor accounts with ripples spreading throughout the entire financial sector.

    It was the right thing to raise a flag over UC's divestment decision. Those that said that I need to conform to the "California Mindset" should look first at SVB and then their portfolios before stating that a little concern about investment policy is unwarranted.

    ReplyDelete
  3. GreggS21/3/23 06:14

    President Biden has performed his first veto while in office, overturning the resolution to protect investments from money managers more interested in environmental, social, and governance policies than earnings for the fund.

    Watch your retirement money folks and be ready to move it to another manager on short notice. Because the failure at Silicon Valley Bank is just foreshadowing of what is to come once these new investment rules take away the requirement to make sound financial decisions.

    ReplyDelete

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