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Charlotte Amalie
Friday, March 29, 2024
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GERS Fund Managers Cautiously Optimistic

'We're positive the worst is behind us,' Safa Muhtaseb of Global Currents tells the GERS board.The mood was one of optimism as the Government Employees Board of Trustees met Wednesday through Friday at the Westin Resort and Villas on St. John to hear from the 14 companies that manage its investments.
The seven-member board also heard from the West Indian Co., which manages Havensight Mall for GERS.
"The market is on the rebound," GERS Administrator Austin Nibbs said Friday before the board heard from the first fund manager scheduled for the day.
Others shared his opinion. Joseph Boschulte, who is GERS’ chief financial officer, said he was "cautiously optimistic." Some of the fund managers have seen significant recovery since the beginning of March, he said.
However, he said some expect the growth to level off, while others think it will continue to rise.
Safa Muhtaseb, managing director of Wilmington, Del.-based Global Currents Investment Management, discussed at length the recent struggles of the world financial market.
"But to sum up, we’re positive the worst is behind us," he said.
Earlier, he said that there was a strong indication that a healthy economy was ahead, but there were challenges to be faced. He said 10-percent unemployment drove down wages, there is too much debt, taxes might rise, and American consumers aren’t spending.
Before the economy went south, he said U.S. consumers accounted for 70 percent of the world’s Gross Domestic Product.
However, Muhtaseb doesn’t anticipate a return to the days when the market continued to rise like it did before the recession began.
Ginny Dargan, AARP’s associate director, said that she attended the meetings because one of AARP’s goals is economic security. Furthermore, she said that if GERS has problems and can’t pay its retirees, the territory’s entire economy would be in trouble.
"Rent, doctor bills, food, grocery, Kmart. It’s its own stimulus economy," she said.
Nibbs later said that GERS pays out $160 million to $180 million a year to government retirees. He expects the figure to rise as more people retire. Nibbs e-mailed a report that indicated GERS has 7,141 retirees and beneficiaries receiving payments.
Nibbs said the presentations by fund managers are done every six months so board members can hear personally how the investments fared.
"It’s like a report card," he said.
The presentations also give the members an opportunity to ask questions, he added.
"And if they’re doing poorly and they don’t have a reason or it’s not just the market, we can fire them," Nibbs said, adding that the board has done just that in the past.

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