Why don't states invest in Vanguard? (death, Alabama, dollars, compared)

[fibonacci]

Why do states use expensive funds and fund managers to manage the portfolios of state employees as wells as the portfolios of the entire state (investments to build cash for funding projects) when expenses for those accounts can go in the 1-2% range? Meanwhile, many funds in Vanguard only charge .15-0.35% for maintenance fees. People wonder why so many states are in the red? It's because they spend billions more per year than they have to for financial services compared to consumer friendly businesses like Vanguard. As a matter of fact, price doesn't even equate to performance. Vanguard even beats many of the overpriced financial firms. Not only that, the expensive firms often sell extremely risky financial packages to states that no one understands. Once they backfire, the investment firms walkaway reaping millions (if not billions) of dollars per year from states, while states are left bankrupt and broken. It's nothing more than a massive fleecing of tax payer dollars.

State Investments Come Up Short


So why don't states use Vanguard or something similar? Could it be because Vanguard doesn't pay out kickbacks to corrupted state officials that manage investments for building projects, retirement accounts, and other financials of states?

[hawkeye2009]

Originally Posted by fibonacci

Why do states use expensive funds and fund managers to manage the portfolios of state employees as wells as the portfolios of the entire state (investments to build cash for funding projects) when expenses for those accounts can go in the 1-2% range? Meanwhile, many funds in Vanguard only charge .15-0.35% for maintenance fees. People wonder why so many states are in the red? It's because they spend billions more per year than they have to for financial services compared to consumer friendly businesses like Vanguard. As a matter of fact, price doesn't even equate to performance. Vanguard even beats many of the overpriced financial firms. Not only that, the expensive firms often sell extremely risky financial packages to states that no one understands. Once they backfire, the investment firms walkaway reaping millions (if not billions) of dollars per year from states, while states are left bankrupt and broken. It's nothing more than a massive fleecing of tax payer dollars.

State Investments Come Up Short


So why don't states use Vanguard or something similar? Could it be because Vanguard doesn't pay out kickbacks to corrupted state officials that manage investments for building projects, retirement accounts, and other financials of states?

Agreed. I have had a vanguard account for investments for a long time. Why? They are cheap and reliable. However, most of my money is not in the markets.

[fibonacci]

Maybe it's because banks like to corrupt state and city officials in charge of finances?

JPMorgan Proves Bond Deal Death in Jefferson County No Bar to New Business - Bloomberg

JPMorgan Chase & Co. (JPM)’s Charles LeCroy said the key to landing bond deals in Jefferson County, Alabama, was finding out whom to pay off. In one example, that meant a $2.6 million payment to Bill Blount, a local banker and longtime friend of County Commissioner Larry Langford.



“It’s a lot of money, but in the end it’s worth it on a billion-dollar deal,” LeCroy told a colleague in 2003, according to a complaint filed by the Securities and Exchange Commission




That’s because in the $2.9-trillion market for state and local government debt, where 80 percent of all financings are negotiated in private, conflicts of interest prevail. While Langford and Blount are in jail, LeCroy is fighting an SEC action. JPMorgan, which provided most of the toxic debt that devastated Jefferson County, has suffered no loss of business as the nation’s third-largest underwriter of municipal bonds, according to data compiled by Bloomberg.

And people wonder why so many states and cities these days are in the red? It's because of those damn state workers and their excessive pensions. Lol yeah right...