HomeMy WebLinkAbout1998-09-24 Minutes•
September 24, 1998
FIRE PENSION
MINUTES OF A MEETING
A meeting of the Fayetteville Fire Pension and Relief Board was held on September 24, 1998, at
11:00 a.m. in the City Administration Building Room 326.
PRESENT* Mayor Fred Hanna, Marion Doss, Darrel Judy, Bill Morris, Ron Wood, Pete
Reagan, and Heather Woodruff.
MINUTES
Marion Doss moved to approve the minutes of the August 27, 1998 meetmg. Bill Morris
seconded the motion. Upon roll call the motion carried unanimously.
PENSION LIST
Mr. Ron Wood moved to approve the Pension List. Mr. Darrel Judy seconded the motion. Upon
roll call the motion carried unanimously.
• INVESTMENT REPORT
Mr. Richard Yada stated the market had come down since July. He read over the investment list.
He stated there would still be choppy times m the market. He stated they preferred less equity
and more money in bonds He believed interest rates would be coming down for quiet some time.
He thought the three month Treasury Bills would be the best performer. The fund was currently
at the same point they were at the beginning of the year.
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Mr. Curtis Williams stated August was the third worst month in modern history for the stock
market. It was his opinion that the Federal Government would cut interest rates next month. The
cut would be more symbolic than anything. He felt there would be several more cuts before the
end of this year. Their main concern was no longer inflation. It was deflation. There was
currently a weakening m the world's financial market. It would hit harder here m the future. The
US economy was going to slow. They were not formally forecasting a recession. They thought
interest rates would be going a lot lower than they were today. Money Market yields would be
less than 2%. CD rates, 2-21/2% and long bonds yield below 5%. Their portfolio needed to
exceed inflation by 2% to grow the fund. They had done extremely well over the last few years,
but he felt the interest rates would stay down for a long tune. It was going to be tough to gain
yield in the days to come. He thought there was going to be more volatility in the stock market.
He felt it would take some time to play out. He felt the markets would find equilibrium. He
noted there were fewer shares on the market than there were several years ago. He added the
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September 24, 1998
demographics and the political environment were favorable for investment.
In response to questions from Mr. Doss, Mr. Williams stated Thailand was down 80% from their
high and Hong Kong was down about 60% and Japan's market had been down for 10 years He
felt the economy in this country would continue to weaken throughout next year. He did not
beheve the equity market would be good for any tune soon. They could make money, but they
would not be getting the high yields they had been getting the past few years.
In response to questions from Wood, Mr. Williams stated they had terminated the funds foreign
investments and had placed them in a money market. He stated they were looking for steady
mterest rates.
In response to questions regarding the foreign investments, Mr. Williams stated overall they had
made a profit. The Dow and the United Kingdom had made up for what Japan and Hong Kong
had taken away.
Mr. Yada stated they would need a letter from the secretary stated they were terminating NM
Capitol and to direct the money to Merrill Lynch.
NEW BUSINESS
Mayor Hanna stated he had received a letter with the State income turn back. He asked the
members what they wished to do with the money.
Mr. Williams suggested an income account rather than an equity account.
Mr. Wood moved to place the turn back money into an income account managed by Merrill
Lynch. Mr. Doss seconded the motion Upon roll call the motion carred unanimously.
The committee then reviewed the summary of the benefit increase.
Meeting Adjourned at 11:35 a.m.
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