Meng Quits -- Notes From All Over -- Page 2 -- August 7, 2020

Breaking, literally: trouble at Calpers -- abrupt exit hits $400 billion fund. From Bloomberg:

The news landed just after 9 p.m. U.S. Pacific time: the investment chief at California’s massive state pension fund was abruptly stepping down. Before dawn the next day, Sacramento was abuzz -- and a sense of crisis was descending over the mighty California Public Employees’ Retirement System.

Wednesday night’s shock departure of Ben Meng reverberated through the state capital and then across Wall Street on Thursday, where the $400 billion Calpers is a powerful player in everything from the stock market to private equity. Meng, in an interview, said he’d left to focus on his health and family. But a statement from the state controller pointed to something else: an unspecified lapse in judgment that breached conflict-of-interest rules and, even more, hinted at wider oversight problems inside the organization.

The controller, Betty Yee, has called for an emergency board meeting to review the funds’ policies....

A veteran of Morgan Stanley, Lehman Brothers, and Barclays Global Investors, Meng first joined Calpers in 2008. Born in China in 1970, he became a U.S. citizen in 2010 and returned to the country of his birth in 2015 to work as deputy CIO at the State Administration of Foreign Exchange (SAFE). He began his job running Calpers’s assets in January 2019 “to serve those who serve California,” he said in an interview shortly after he started.

What may have been a dream job soon turned sour for Meng. He faced not only the immense pressure ....

Earlier this year, he was accused by Republican Congressman Jim Banks of being a tool for the Chinese government, funneling American money into Chinese hands due to his role at SAFE. Arkansas Senator Tom Cotton and Wyoming representative Liz Cheney, both Republicans, expressed support for Banks’s inquiry into Calpers’s and Meng’s ties to the Chinese government.

Harder to dismiss was Calpers’s failure to hit its annual 7% target during his tenure. The fund reported a return of 4.7% for the latest fiscal year, after gaining about 6.7% in fiscal 2019.

US unemployment rate: falls to 10.2%. Link here. 

Market news.

BRK, link here: 

• ready to buy? has recently bought:
  
• Dominion natural gas assets in July
• BofA equity in July
• earnings this Saturday, tomorrow, August 8, 2020, forecast:
  
• net income: a record $37.7 billion
  
• record cash pile in March, 2020
• share buybacks: 
• $5.3 billion between April 23 and July 7, 2020
• a total near that level would surpass Berkshire's record quarterly repurchases sinces loosening its buyback policy in 2018

Uber: posts $1.8 billion loss in 2Q20; deliveries skyrocket. Link here.