Comments from the Chief Investment Officer

Board Meeting – December 19, 2007

’Twas just a week before Christmas,
But there was very little cheer.
My staff has been struggling
For it’s been a frustrating year.

Still, our stockings were hung
By the Board room with care
In hopes that St. Nicholas
Would bring back the bull, and scare away the bear.

The Fund was now worth
More than 12 billion five.
This year’s market action,
May make me break out in hives.

Through the early part of the year
The markets moved steadily up,
Except for that time in February,
When China caused a hiccup.

Now the rest of the year,
Has seen volatility returned.
And if you owned subprime mortgages,
Then you’ve probably been burned.

Our US stocks are up slightly,
Our managers just missing their mark,
And bonds of high quality,
Well, they’re in the same ballpark.

As for international stocks,
Again, they’ve been leading the way.
For their performance this year,
I’d still have to give them an “A”.

And our real estate portfolio
Has nearly completed its change,
And along with private equity,
Their performance is at the top of the range.

Amid a lot of mixed news
We sure can’t relax.
Because you never do know
What might derail this market from the tracks.

It might be the Federal Reserve
That will play the role of the Grinch?
Some think this guy Ben Bernanke
Has put the credit markets in a pinch.

At their last three committee meetings,
The Fed has cut its target rate.
But the market is clearly shouting.
“We’re afraid you’re too late!”

Though the Fed has cut their rate,
Pundits say they don’t have the nerve.
Market rates have fallen further still,
Which means the Fed is way behind the curve.

Home sales and spending are slowing.
Inflation, it’s been rising.
Recession? Stagflation?
The future’s sure to be surprising.

Oil kept on rocketing,
The dollar, it sure did flop.
The latter did fall so much so,
That even Canadian tourists came to shop.

At Merrill Lynch and Citigroup,
Those stocks were falling toward the floor.
Their CEOs were handed fat checks,
As they were ushered out the door.

The Ohio legislature wants to help us,
Divest from Iran and Sudan.
But when the government wants to help you,
Run away as fast as you can!

While their intentions are noble,
And it’s hard to argue with their goal,
The one thing they fail to mention
Is our fiduciary role.

In recent years, I know we’ve made money,
But the actuary just smoothes it away.
Thanks to their statistical techniques,
We can’t seem to keep infinity at bay.

Yes, concerns do abound.
They can mess with your mind.
But experience has taught me,
A balance indeed we will find.

So hope springs eternal,
At least in our investment shop.
And on these dark days we work on
Past when the clock says to stop.

And when counsel I needed
My loyal staffers they came,

And I begged and I pleaded

And called them by name.

Now Rob and now Heather,
Now Jennifer and now Bret,
Yes Joe and you Ellen
We can’t rest just yet.

It’s time to step outside the box,
Use your heads now to think,
Let’s work to add some value,
Then we can go have a drink.

So off to their computers

My staffers, they flew.
Reviewed new ideas
And investment plans too.

So after giving some thought
And discussing strategies still new,
Our asset allocation, while solid,
We think it’s time for a review.

Now “alternatives” is the buzz word.
And hedge funds they do abound.
But as we’ve seen elsewhere,
There’s only a few we’ll want to keep around.

So, we’ll work with our consultants
Study risk, return and correlation,
And when we are done, we’ll have a plan,
Worth all the aggravation.

Yes, our investments are quite diverse,
Our performance remains strong.
The Board can rest easy.
Their plans have not been wrong.

You see it takes patience and calm
To win this game called investing.
As I’ve learned over time,
A long-term view is the best thing.

Yes, patience prevails
This Board surely knows now.
So after counting our assets,
They can close the year with a bow.

So enjoy this Holiday season,
I’m done with this rhyme.
Remember in Investments,
It’s not timing, it’s time.

Points of clarification:
The portfolio ended November at $12.81 billion.  Through last night, our portfolio was worth $12.53 billion.  This, of course, is down from an all time high of $13.22 billion at the end of October.