January 10, 2013
GIVEN THOSE STOCKS’ EXCELLENT PERFORMANCE, IS THIS A BREACH OF FIDUCIARY DUTY? Teachers’ retirement fund to divest from gun makers.
UPDATE: Reader John Gray writes:
The answer is “Yes”. CalSTRS is only 70% funded. They only have $0.70 for every dollar they have promised to pay retirees. And that funded ratio is falling. For the trustees and staff of the system to be doing anything other than maximizing return per unit of risk for their participants is a breach of fiduciary duty, and they could (and should) be sued. This particular breach happens to chap my hide, but CalSTRS and CalPERS have been doing this kind of dopey social engineering with their investments for a while. No wonder they’re so poorly funded.
I wonder if anyone will file a lawsuit over this? All you need is one covered California employee who likes guns. Or wants to retire. . . .