After America\u2019s stock markets hit their lowest level in five years last week, officials with the Northern Marianas Retirement Fund are saying their investors should \u201chang on\u201d through the turmoil in spite of news from a leading investment firm Tuesday that the nation is likely facing a long-running recession. <\/p>\n
In a presentation to the CNMI legislature, Merrill Lynch consultant Kenan Knieriem yesterday said America\u2019s \u201cspiraling\u201d housing market, coupled with\u2014among other factors\u2014rising rates of credit card and commercial debt, are contributing to the nation\u2019s economic downturn. Investors, he added, might be in for a \u201clong and deep recession\u201d that, according to some estimates, could span from at least 10 months to up to two years. <\/p>\n
A key Retirement Fund official last week acknowledged that the stock investments the fund\u2019s managers have made stand to take a hit from Wall Street\u2019s recent decline, but the fund will likely see fewer losses than the market due to the its policy of selecting a diverse array of investments. Knieriem, in his presentation, appeared to back that stance, saying that the fund can ride out the recent turbulence on Wall Street.<\/p>\n
\u201cThis portfolio has been through the crash of \u201987, the S&L crisis in the early \u201990s, the bear market in bonds in \u201994 when the feds had crushed the bond market, the \u201997 Asian bank failures, the Russian default in \u201998 and long term capital, the tech bubble and the last recession\u2026 and this fund is going to make it through this,\u201d he said. \u201cWe\u2019re going to make it through this but we have to be disciplined to the investment policies we\u2019ve set up.\u201d<\/p>\n
Retirement fund board chairman Juan Guerrero advised the fund\u2019s investors to take a conservative approach to the stock market\u2019s downturn.<\/p>\n
\u201cThe only thing I can tell them is to just hang on and not to react negatively,\u201d he said. <\/p>\n
When Guerrero addressed lawmakers after the presentation, he gave an impassioned plea for the government to provide the fund with more money in order to cover the payments it makes to retirees and maintain its operations, noting that the fund\u2019s assets have already dropped by 22 percent during the current fiscal year. The money that the Legislature has allocated to the fund, he added, is barely enough to cover its annual expenses. <\/p>\n
\u201cWe need the government to pay their obligation,\u201d he said. \u201cWe need you to look within your resources.\u201d<\/p>\n
After the session, Rep. Joseph Guerrero (R-Saipan) said lawmakers are now in early talks on ways to meet the retirement fund\u2019s needs, such as a potential deal to give it additional funding. <\/p>\n
\u201cWhat we didn\u2019t know was what the actual losses were, so now it\u2019s more important that the administration and the Legislature really make the fund more of a priority than we are right now,\u201d he said. \u201cWe are certainly looking at other ways of funding the Retirement Fund. I\u2019m not at liberty to discuss them right now until we can get a consensus but, just so everyone knows, we are looking at other options.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
After America\u2019s stock markets hit their lowest level in five years last week, officials with the Northern Marianas Retirement Fund are saying their investors should \u201chang on\u201d through the turmoil in spite of news from a leading investment firm Tuesday that the nation is likely facing a long-running recession. <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-127135","post","type-post","status-publish","format-standard","hentry","category-local-news"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/127135","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=127135"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/127135\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=127135"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=127135"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=127135"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}