Howie and Mike Travaligni

" From a new Reynolds world headquarters building. Here is gone Hollywood -- show what congress has approved roughly 200 million dollars for. Free -- jets to be used by members of congress and other missions."

" They just. There's a it's a delicious irony in seeing. Private luxury jets flying -- to Washington DC. And people coming off of them with tin cups in their -- saying that -- They're going to be trimming down and streamlining. Their businesses. It's almost like seeing guys show up at the soup kitchen. Hi hat and tuxedo."

" Number one and I think it violated the rules of the house to do it. Number two congress does not need a new expensive set the executive jets. And number three when we meet again as a committee -- what are the -- to rescind this much power your car."

" Okay. So you'll be the judge okay it's plus okay. Now -- mean come here."

" Okay."

" And I'm not powered -- don't you RKO radio network. 1877469432218774694322. Will be -- Boston tonight for the very exciting Red Sox pregame show -- about 620. But you can continue to listen to the show on the WC RN AM 830 in -- CRW -- and AM -- we have a very interesting guest here with -- you what you -- we got bunch -- payrolls from the -- like public agencies and we post them on our web -- And I you I wrote about one of the agency's that that we got the payroll for the pension reserves investment management board the prim board. And the crew more and isn't run by a Danny might travel -- he's the brother of the former -- senate president. It and I guy got a call at nighttime pointed out that the the -- board and they'd they'd handle the pension investments for the for the state. And they've they've they've had a brutal year they they had a good July but they had a brutal year they lost 23. Over 23% of the investments and I pointed out that. This is this -- board has 24 employees. In fourteen of whom. Make over a 100000 dollars led by a might travel weenie who makes up 322000. Dollars a year and -- I was quite surprised this morning one idea picked up my cell phones on number didn't recognize that night I answered the phone it was my travel weenie he's so how I wanna cut you know why you -- have me on how come on and I'll talk about the -- board and our salaries and though what we though. I said beautiful. So might travel -- Israel as well this here tonight in the studio the highest paid state employee we've ever had in the studio. Mike thank you -- I appreciate being here will listen to you what -- eat my point it is. Why are we paying you guys all this money when we're getting -- sub par performance here well that's that."

" Now -- the sub par performance as you can use your own words was for the last year. But I just wanna remind everybody the prim board's been around since 1985. Right so for -- and I certainly haven't been around that long. Com budged over that time we have on an annualized basis. Earned nine and a half percent right so obviously some years are good some years are not. Where charged by the legislature to -- a quarter percent on an annual basis so the -- board has. Throughout its history exceeded its investment objectives on a long term basis now anybody can pick. Any single snapshot and I think I've heard other shows these -- had where last year anybody who invested last year whether you have individual 401 -- or any pension fund. Lost to similar to how well the here's the thing my kid and you know this isn't just you with the -- board but I was thinking about this today after you call. You know window when the market's going up everybody's a genius right -- get big bonus is you get bonuses when the when it goes up right well not only when the market when we add excess value show. The way our incentive compensation plan works is we could make money. But not get a bonus if we haven't beaten. Those are prescribed benchmarks and similarly if we lose money we could get a bonus now let me just assure your listeners. There are no bonuses this year at the bad the -- board for anybody so I know that that's probably something or another I wanna be a sure okay so but but one."

" I'm saying is you know they would you get bonuses whether you're that you were or of the Harvard and overseers or whoever it is sort of money managers that -- I put my 401K until they say you know they're they're geniuses right they take a bow. Yeah and then -- then there's a year like this year has bad. We're last year. And edit then did they they throw their hands and they say all what's the market. And here I'm tired of that personally yeah I that's why I thought I mean that's why I. I didn't lose 23% last year by the way because I was more I started move my money -- I wish I'd move more of -- right well dug -- but what did you do what you moved -- and don't mind because if you moved it out of stocks you've missed. The resurgence in 2009 -- now -- you know I'm just putting -- I'm just putting in in the money market -- getting money back from that -- The Herald is matching it to a degree so I'm making some money but -- I'm through I'm through with the market calmed -- I -- I -- money in the market bottom up what many more money and that's that's what I'm saying that and it seems like you -- you guys I -- US tips to basically state jobs -- that we do we do -- these these -- stating these sustain jobs for big money and couldn't we have done just as well we meaning the taxpayers. Couldn't we have done just as well basically -- an index fund last year."

" Well let me just try to put it in context as we do have state jobs. But what I want to relate to folks is. We did -- compensation study three years ago using an outside independent compensation firm this is what they do. And when all the state pension funds were looked at the salaries of my employ me in my employees. Are at the median of all public pension funds nationally so. -- everything you've written today and everything we've talked about. You are as accurate as can be so I'm not trying to take yes she -- are you presented at the what I try to convey to folks is the appropriate peer group for us. Is -- out their staffs and other pension funds are doing and where essentially average. From a salary perspective again why -- you -- your can your Mike travel -- Bob traveling the former senate president's brother former chief aide to she M O'Brien -- You're connected I I am connected although. I have a degree from Harvard so Bobby didn't take my exams when I was there I have a degree from Georgetown law school. He didn't sit for the Massachusetts bar when I pass that on the first tries so. Listen I understand the point but I guess if my name is Tim -- your -- well I -- and I'm not gonna comment on that but if my name was Michael Jones would we would we be having this conversation part of -- says we still what are we -- we -- we -- but I mean the fact that your name is -- makes it about it I -- that that's you know it's part of why collagen and I think it's part of why you're excited to have me down by. Who what they got to ask you about first before we move will -- some -- by the way that he wants to talk to anybody whether you're at taxpayer already are -- they state employee you're tired state employee we have Mike traveling whether she's ahead the -- board. Now you're you're one of -- Massachusetts is perhaps the only state that got ripped off by Bernie Madoff. I wrecked their -- hand they're small amount less than five engine New Mexico there are others plans that we talked to and I did have Madoff exposure -- guys got ripped off by -- we did. I mean how. How how my supposed to think that -- that you know that you guys are doing a decent job when you got ripped off by Bernie Madoff well I think one of the things you have to remember when you have forty million dollars now we're back to forty million right as of today in terms of assets under management. When you diversify that you're invested in a lot of different. Individual stocks. And in the alternative asset classes a number of different hedge funds so listen I'm not gonna our selection of the firm that put us in Madoff. Was a mistake and we fired that firm but it was a fire the guy who hired the firm. I know that's those are the people on my -- my staff who writes I don't believe they can six figures are making six let me -- truly that's why I mean the -- George just not only used twelve million bucks which you lose it's -- such a -- amber has Bernie Madoff while I think what I'm trying to convey how he's in the investment business in the asset management business units one I think Warren -- you wanna take Peter Lynch. Not every decision that those guys meet over the years improved. You know they'd return money right debut again in -- if you're gonna be investing my you have to be willing to lose some at some point. Right so twelve million dollars was army doctor exposure on a forty million dollar portfolio again not. -- not excusing it but the point is you gotta keep -- in. The proper context 18774694322. If you wanna talk to what might travel -- EI he's makes 322000. Bob do you think that's do you think that's a the a little bit of Baja steep salary for the need for this year -- your performance this year I -- and add to the fire I I don't because as -- said when you take. People when I do it all the other state plans writing down his -- as the comparative universe. I am in the media and I am not -- out liar on the high and I'm certainly not on the low end by any stretch of the imagination so when you've had a crappy year was that that's safe to say isn't it absolutely you've you've been below average. Different one year -- yes yes why hedge funds right no actually did that's that's that you reminded me of a great point. We have a lower bond allocation. -- most of our public fund peers fixed income right now and we have a higher non US stock allocation and most of our public fuzzy personally I have a lot of boss myself -- I'm planning for I'm claiming to be. You retiree at some point you know immediately maybe you should have more bonds well I think which after members we have a large unfunded liability right so we're trying to pay for benefits that have been paid out previously over the years so the -- you you raise an interesting point we're only about 70% funded meaning. We need to. 30% additional and if -- not making an investment returns how -- it's coming from taxpayers let's take some calls here for a Mike travel -- he's the executive director of the pension reserves investment management board I wrote about today it's -- really it's it's -- be the highest paid on average agency in this them Commonwealth of Massachusetts yeah -- smallest number PLO but I'm you know not not not -- Paul your next with Howie -- and my traveling New York have Paul."

" Beating and I don't -- just a quick question my -- I wanna make sure I got this right I understand politics is when you make money. But I thought you said you get bonuses when you lose money so."

" I says there's the potential for that and let me just quickly explain our incentive compensation plan. Is based not on absolute returns IE if the fund makes money or doesn't make money. But it's based on benchmarks that are set for our staff. And if we exceed those benchmarks meaning we've added the decisions we made -- that in excess value. Then potentially you could have a year where the fund is actually lost some money. But -- values been created and you would then get a bonus."

" Well that's stacking you know that that I and again di Leo look they want they want to order a better relative last name is you're right -- its -- But it didn't. Average reviewing it he also not asking is what sort of others incentives are -- they did add that up or its preeminent -- include everything might."

" 3320. -- three to any Joe how he's gonna make sure he tracks that come whenever bonuses I'm able turn at a maximum up to 40% of that. If if the bonuses. That's the -- you -- up with likes most about 450. Yahoo! for twenty something I think is that is the max and I and I get a parking spot thanks for the call Paul Bill you're next with how we --"

" You know when our time we don't I'll take -- Tuesday around we'll just a CR and we'll go to CR and everybody AMA thirty. WCR and -- talk for central New England this show will continue. On AMA thirty WCR and I'm Howie -- 187746943. To enjoy appreciate and stand around were off the -- Boston -- still well we're still -- in Boston because we're still you can still hear us on the UC RM AMA thirty. So we're here without my travel leaning he has the executive director of from the -- more of the pension reserves investment management board and he's here to answer write your questions are more about his agency today. They it took to put it in a nutshell they lost that 23%. Last year in the market I know everybody had a tough year. But these this agency that Mike travel we -- provides over and they have 24 employees fourteen of them. Are making over a hundred grand it's the per capita the highest paid agency in the commonwealth. They lost when he threw him in the third down -- the match you ever had in in in the pension fund."

" I've met max Macedonia. About 52000052. More US now we're just -- forty again we've we've the lowest we went to on March 6 of this year was 34. 1000010. Were back up to forty from -- even march 6 of this year so."

" 18774694322. -- just take some calls here. Then again -- if you if you're retired state employee are about to retire her still employee and you'd like to ask him a few questions feel free. Bill you're next with Howie Carr and might travel we need be head of the state pension fund go ahead bell."

" And -- I know. There are giving credit might hit release fit in the form cause. How -- you have the most left the group made up about these kids get this falls asleep but they've worked he slowly please. Our video and more could not. I go to college and I've been mentally -- too much both for the what is the outlook are generally on the economy today's street. Via Walt we are being. Won't do as good I don't trust the word Obama paid a -- probably -- I want to get his overall opinion out well."

" the one advantage we have had the pension fund is we'd look to make decisions. That are gonna pay out over ten and twenty year periods so. I'm not into giving individual advice just the general outlook obviously the first part of 2009 are actually not even the first part that the second quarter of 2009. Was the best quarter that if our fund has had in ten years so it. That was a less fun that was the last quarter everybody said oh Mike I mean this is the thing I mean you he didn't get many -- it hasn't gone now for something that happened that it hasn't been because if you had Barnes like you do in the second quarter yeah you didn't have the best court you -- in. Ten years so again I'm just trying to say we said asset allocation decisions not for the short term but for the -- my goal. Again I'm in the pension -- in how we car pension reserve fund -- my goal is not so this is too. Protect capital. And today and -- and and I don't disagree although as Arab. To remind you the state has a 30% unfunded liability -- them so evolve we do is protect capital a -- The taxpayers are automatically gonna put in that 30%. So a lot of people I talked to like the fact that we're trying to use investment gains to minimize what they're ultimately gonna have to contribute into the pension fund. So that seems to be a bargain not a lot of people that I talked to are comfortable -- of notwithstanding short periods where it's painful the what are these one of these investment managers see these people like Ted Kennedy's son. I mean he's he usually does business with you right well his firm does okay for his firm does he he's got a firm called the -- we're group. Which is a broker if you will -- third party marketing agent that represents asset management firm but isn't the SEC -- as saying that you know that this is this this is. -- two. There's too much potential for corruption here with these these outfits in the maybe they should be banned. Well I don't I don't. Think his if you say the whole the whole point of these brokers slowly New York there was just a huge paid -- patent pay to play scandal yet there are troll who was the treasurer there right -- had to resign and -- yes he had a he had a guy that -- was basically funneling money to while it was his political consultant yes so I think. One of the things you need to when when we deal -- third party placement agents there are firms that this is their line of work. As opposed to Hank Morris in New York who he was Tennessee's consultant and any formed an LLC and called himself -- placement agent so you can they're pretty transparent you can see through. Who legitimate outfits are right that's number one. You know number two we had cram for ten years have. Sought disclosure of any third party arrangements when we are interviewing firms that we're gonna give money to number one and then you might like this. We also use KPMG currently but we have an independent audit every year review. Every manager selection that we've made right so they take the our -- they take the criteria they look at -- who wouldn't stay where you live then you know the stated you know how it is here I AM mean he's so you're you're the Senate president's brother and your hiring Ted Kennedy signed. Yeah I know and and again I'm I'm not making. The hiring decision if personally I mean that's that you know you gotta give me a little slack on that we've got a staff. Of 24 people there's a nine member board price so even the treasurer who sits as chair of the board. Doesn't individually select the governor sits on the board as well. There are just so much money here. Well I I do but I think if you look at the long term a while many let me try to assure you -- way way we're not making decisions based. Who we give -- to based on the political connections right now do we get the cost to say -- you take a meeting with somebody because. Mar orders fronting them absolutely don't ever call you got a call saying that -- you morrow would meaning Ted Kennedy junior. Yeah his his firm is days they'd like to bring in another firm -- again it's not giving. -- money this firm he's representing. Just like I got a call from people that know me and say I'm representing a firm can I mean we're in the business of hiring asset management firms. So we should at least be sitting in listening to what these firms have to say before we say -- no. I'd love to talk to you but you thank -- Ted Kennedy's kid so I can't I mean that's. I think they'll be okay with made okay well nine minutes I'll I'll take that under advisement and I'll I'll bring that -- talk about how does that how does and how does Ted -- get into the business unless she's selling you know that he can get a meeting for people well and in fairness to Ted Kennedy salary and they and there are others to -- that are absolutely but in fairness to Ted Kennedy signed. I don't deal with him there's an individual and he's more on the health care side. So I honestly don't know it's been talked about I don't deal with Ted Kennedy's son although I know who we is certainly there's another individual named Brian -- Jen who's in their financial services sector. And that's the person that idea with being on -- on a regular basis so. I'm I'm not entirely disagree with -- it's not as cozy and comfortable as you would like it to be. 18774694322. I don't wanna get caught picking up the tab I gotta -- about this young guy and I'm worried about each seat cram I don't need to be worried about anybody else's cram. Yeah John that John your next what Howie Carr and Mike travelling he's the executive director of grandma the pro more to go ahead John."

" Good evening and Mike thanks for appearing on the show I know it's usually a tough to be under the spotlight of -- but I'm glad you're here. Quick question you mentioned you've got a 30% viability overhang and you said that you've got a higher equity exposure. What is your acid allocation look quite as well as your alternative facets. And I'm what do you do for actually hedging SC did it the last twelve point eight billion dollars. When do these hedging strategies. Come into play and are any of your advisers using -- trade."

" I know none of our advisers using caller -- let me just quick Q where -- 27%. In. US stocks we're about 25%. In foreign stocks we've got 10% fixed income. We've got high yield debt which is junk bonds in in the -- 6%. Private equity 10% real estate 11%. Timber 4% rule states a bad move these days is doing well a again we don't do it as a tactical play how we so we have a 10% allocation which is a small allocation. On a 100% right. And real estate as an inflation protection. So their reasons why you -- the assets in a way that we do to be diversified so that you try to give yourself the best chance in all market environments to. Weather the storm and hopefully make. Investment gains because that's where it's all about the do you have any did you have any experience enough for the private sector in the in this field. Like with fidelity or putt my Hummer popular I do I do I know you might find Osama lawyer by training right so I worked -- Goodwin Procter and more which is Boston's largest law firm right right started my career. -- and then after I left the O'Brien administration. I did work at Putnam Investments that -- post office square now again. I've never been an investor I'm not a portfolio manager right so I worked at Putnam you're not a traitor in the sale I'm not a traitor right I don't sit in my Bloomberg and say you know what I BM looks attractive to me verses from school today that's not -- you were a lawyer for -- No I was our client server sent a marketing person for Putnam and so dealing with their pension fund prospects in trying to sell the Putnam products that. To their prospects. Thanks for the call John another John go ahead Johns."

" Probably Michael -- good good John very good coach Mike thanks so and then there you've got questions for economic freedom in what were. You know -- had a great you know I don't know the -- smoke and I coach -- You know you don't actually orchestrated America yes that you hire asset managers -- maybe allocation correct that's correct. -- What are your -- what is your job is finished he's guilty or more of a there's very noticeable with supervisory role -- would imagine right."

" Jiang -- that's a fair characterization."

" Okay so how old do you. You don't qualify you that's that's salary in other words you're certain you've you've it's stated my servers -- just it was still. What they're comparable. Government agencies and then -- metal in terms of earnings right touched. -- Conduct performance is really very little to do with your. Dropped. You market performance for a total return. In the market norm you're very earnings on your investment is there's very little to do what's your capacity your responsibilities very."

" Well can I I wouldn't agree with that let me let me say --"

" As early as a benchmark I'm you have to -- to beat the benchmark or orders. I mean how are you insert it or how can you be let go. You -- performances yup."

" Would you be and that's a good question how could you be fired. No offense well -- for a guy I work at the pleasure I don't have a contract right I work at the pleasure of the nine member of trim board. Treasurer -- chairs and Governor Patrick has a seed. Governor Patrick gets to appointments treasury gets one appointment and then for the members are elected by the beneficiaries to people whose Murray and his."

" So they're not gonna bid there not crew are. This -- you know it's pure performance or you're gonna blow you get an -- miniature I would imagine I mean there are gonna be your fault of general manager before."

" Hello Greg jump when I'm so the points -- is gonna make his asset allocation for anybody who runs a pension fund you know that. The bulk of your return comes from the decisions you make about which asset classes in how you size them writes how much you're gonna put the socks how much is an important bonds. All the empirical data shows that those are the most important decisions right about 85% a year return comes from that. So I don't wanna make you sick to my staff and I work with the board on recommending to them these allocation decisions so there is. If you know did there is value in that does the -- get off Bunker Hill that. No we whenever the market is opened we are we are open up the stock market is evacuation -- the -- borders workers from borders working. What I wanna -- we never made ECQ what's his background he's leisure she's the number two guy he's the chief investment officer also he's his background his background is he came we hired him out of John Hancock Financial Services so he was. In the private sector and he was doing. Basically hiring managers for John Hancock's investment platform so his job there was to identify who were the best in class managers and any asset class very similar to what -- I don't mean this to be disrespectful questioned but it seems like if you were if you -- top -- the line. Type -- guy did John Hancock can be making more than 235000. Correct I think abstract. So. If this guy won't goods and he could move up why would you want to work for the -- born while I I think I mean big guy he you know that's I think it's a legitimate question -- it's a legitimate question by in the gas and I'll tell you one main reason because it applies to me even though I think you might not think so. There -- quality of life. Decisions right stand has young kids. I have young kids in the asset management business -- jobs that pay the most you are on an airplane. If not every week. Every other week. And you're leaving on Monday and you're coming home on Thursday night okay so again. And I don't use -- said there was a comment today your article where the individual said well we can make more in the private sector so everybody should be. Should thank us for doing what we do I don't take that approach. I can go get a job where I earn more but that has nothing to do and what we're talking about here. But if I were to do that I need to be on a plane sing about in my life and kids on Monday and I'll see on Thursday night. That is a big driver at least as I understand was last time you fired somebody. Fired a manager -- how. Just two months ago at our February well what are you keep them I'm getting my amounts from our February board meeting. You fired a movie -- prefer harmonies of fire than one manager that well that was the Madoff was that the made on the Madoff was what actually was the Madoff made off we learned about last following didn't -- last December and didn't have a meeting until February. And you're fired you're fired the guy who hired the company that brought on Madoff exactly okay so that's now what was the last eight fired before him. Com there was another hedge fund of funds now again we use we don't make. Investments in direct hedge funds we use a fund of funds which is essentially. Eight manager we give money to that then decides which underlying hedge funds that they're gonna invest your but it still ahead should still have trust no actually I'm just trying to say we. As a hedge fund of hedge -- and exactly. Yes but. My point is even though it is more expensive because I like -- hedge fund and intentions. I mean I'm sorry eight the BM number it number conservative about that I. And and in your absolutely right the point that I know the way they could -- you took a beating last year isn't known not because of the hedge -- snow again because we had low allocation to bonds and we had a higher allocations to non US stocks right so those are really the main reasons why we took. Especially on a relative basis why we took a beating. Com but. We have hedge fund size that he percent of our total portfolio how -- yeah and what I've try to explain to all of our participants who expressed. If you take hedge funds in a vacuum they are the more. Risky and complex investment I mean I'm sure -- let the only person who's ever set Vista yeah I'm sure a lot of the people there were counting on you for retirement are very concerned about this allocation and and I have found honestly when I talk to people and I get to remind them that. 92% of the assets are in other. Places not in hedge funds so we're talking about 8% of what we're working -- That that's a reasonable allocation. To an asset class that has potential risk return. Attractiveness."

" 18774694322. -- here with my travel -- he has the executive director of the pension reserves investment management board you can you can go to our website at the Harold actually and to see these these salaries few Vienna in in the about it we have a link on our website at how we cart dot com -- and fifth at The Herald will thoughtful enough to do well put it in that terms of decreasing compensation absolutely -- as you I appreciate that very much did you see the fourteen write in a row there there. 1877. Foresee is anyway as you want got to raise this year no no we haven't gotten thank you for that we have -- raising three years. Nobody's got a -- hasn't gotten a raise in three nobody's -- raised here and every generation parents aren't gonna raise and no bonuses this year I'll keep I'll keep reiterating that as well as I know that's the sensitive topic for people. -- your next what Howie Carr and might travel -- from the pension reserves investment management board go ahead rob."

" Sure there -- one thing I don't understand about the hedge funds is that the heat source so outrageous. Not only do these managers get double or triple. A standard manager in terms of their fixed speed but then any money they make. Above usually a pretty trivial benchmark. They get 20% of the outside itself if they lose money indeed the pension fund bears all the risk on the downside."

" But if they make money they're getting 20%. On the outside and these these can be really outrageous -- years when."

" When the market does well I I really don't understand -- the standard manager probably gets a flat fee of anywhere from. A third of our first sat out there may be a full percent but up. These hedge funds go to pursue other and then they get 20% of the outside and it's the fund that is bearing all the risk guy I really don't understand that setup."

" Rob that's a great pouring. We share your frustration about hedge fund fees the only thing I can offered to you is at least for the -- relationships. We don't have any performance fees we have negotiated. Flat fees from all of our hedge fund of funds. But you are right dead into."

" You -- that's actually yeah no have been -- many phones do that."

" But we're still frustrated at the level of fees and one of the things we're trying undertake right now given the poor performance by hedge funds. Right because these guys are called themselves absolute return managers Richmond. They can get you a positive return regardless of the into the broader market environment. And so we think we're we have some leverage. To go back and negotiate even further to get some fee reductions because of the poor investment results that they've delivered again in the short term. 18 thanks to a Colorado good question 18774694322. You think you're so you think you're worth 342000. Dollars this year. I I think that I'm paid. On par with my peers doing the job that I do yes I mean you think this year you do you think the well are you gonna 342000. Dollar job well here's what -- say beyond that -- in -- had a job for five years Shiite. Three years ago we had a 24%. Return. And and the fun made twelve million dollar Goodyear that here too even with my A exposure to -- the money market but I didn't hear you clamoring are writing for me to get out of fat raise at that point so yeah yeah yeah. Saying is everybody was doing well three years ago if I if if you look as they again. We -- where are measured on a public fund database right so. The five year a number of we beat. 75%. Of state plans on the five your number yeah on the tenure number we'd be 83%. This three years ago. None of this is this is including this is through June 30 of this year so this includes although. The 23 point six that you would you wanna keep reminding everybody about the last year of losses so my point is you can't judge a plan sponsor. On any one year. -- you've got to look at longer term period should try to get some sense or whether they are they adding value. Given what they are charged with -- doing and given the number of made offs that are out there how we you know -- be and it would be and ripped off again my another one of these so Ponzi guys well that that that that's a great question because the Madoff was -- particularly frustrating one. And when I say we use fund of funds. These -- firms that have. Loads of people dedicated to due diligence. And the problem with -- particular firm was the chief risk officer has joined the firm in 2001. Dear Madoff investment was made in 1997. And he put in all the -- risk controls -- effectively. So he didn't go back and -- paid any attention to Madoff that's the problem from the SEC on down well understood but. We this firm got the Madoff investment through what's called the feeder fund and I won't get into that but the point was. You know we we we don't use feeder funds anymore right wee we wanna deal with the people who are actually managing. The money and when we talked to -- this hedge fund and we said when was the last time anybody's visited -- Madoff. The answer was 2005. Now this is 2008 montage so. We're supposed to be doing due diligence and all of army Rangers one C annually -- staff is in our finalists for the guy who who who. Who put two into the Madoff fund how much it was he make it. I it's it's a there's a woman who's responsible for our hedge fund. Activities and she makes 125000. All of which you have been done that was like about the person you fire though holiday -- again it would be a -- it would be a basis point fees on the assets so would be. And using 85 basis points on 170 million dollar basis points are -- but I -- how -- but I thought to have an employee who was fired because of the Madoff I don't know knowing no no no employees were fired going employees were -- firm that assumption that we selected that invested in Madoff the firmware was hired just no no. No insulin was the last time you fired an important -- we haven't people have left on their own but nobody's been fired at -- in -- What -- the with the five other for the fund a hedge fund to fund one of the firms we gave our what is it brought made -- cost them the twelve million that made off us -- So see you and I mean what kind of mean but that's the way the private sector operates -- private sector fires people -- well think again we've got 24 people so it's not like we've got hundreds of people we do we and you annual performance reviews on people. We've had a lot of turn over because. Young people that we hire when they get the experience and -- become much more marketable to go to the private sector so we've had a lot of people who have come through tram. And gone to the private sector so. There's a natural turn over. But if people commit and do what they're supposed to do I mean should we be firing people just -- make a statement that -- I can answer in the affirmative that we want to come back to that 23 point 6% I know I mean I I -- I -- places I've ever worked could be body bags going out of place if they lost 23 point 6% but you never -- their pension fund that you're -- that I ever have maybe a ratings issue right ratings is our short term everybody -- looking now again -- When you measure us over longer periods of time I think people are generally satisfied with what -- the results -- I'll say one more call for a Mike traffic and Matthew you're next with how we guard Mike traveling he go -- my Matthew."

" Leaving Kelly might cossacks were my call -- look at a friend who is a portfolio manager at a large investment firm might say he makes. -- low sixty gets help like that I was talking this morning and he says regardless of income you can never worked harder. Where the money his entire life then. We've worked the last couple years on it the return of the war on there what was former actually doing anything go 24/7. With the customers. To try to keep them focused long term I don't know if you run into the same the same problem there."

" He sounds more a salesman and believe you me your your -- like a salesman Matthew."

" No I really feel like -- if you would be are sort of infill but he works are directly with the customer base. All thought they have off large customer that I would like to -- an allocation around your McCall and we actually -- we can make on the call."

" I was -- call Mathieu but I hear you make the call on what the allocations are. -- gallon and we only change those every true we don't sit weekly in sort of change as we set those every three years and then revisit them every three years okay -- traveling and we really appreciate you -- men and thanks for a taken -- taken a few shots and I appreciate you give me the opportunity I really do okay that's my travelling he's the executive director of -- board. 18774694322. On --"

" And."

" 18774694322. Then if you wanna look at all those -- a public agencies and authorities we just got 26 up from yesterday aren't supposed to at Boston Herald dot com we only on our web site. Jim are you still there good time for about one more call -- their go ahead jump."

" I am shocked that this got -- of money problems. Good every time you ask -- question of all you know specific jobs Hewitt say it that members staff take care about. -- it just gives it to democratically kerrobert besides often every decision made right."

" Yes he's the boss he's the executive director of -- thank you for coming in the movie is the highest paid state employee we've ever -- how we are show. We ever had -- of how -- car."