REPORT:

Investment Oversight Committee

SYNOPSIS:

The Investment Oversight Committee met Friday, November 6, 1998 and discussed various issues detailed in the Committee report. The next Investment Oversight Committee meeting is Friday, February 5, 1999 at 12:00 noon in Conference Room CC8.

RECOMMENDED ACTION:

Receive and file.

Norma J. Glover
Investment Oversight Committee

Attendance: Present were Committee members Norma Glover, Jerry Rogers and David Ertel. Absent were Committee Members William Burke, Michael Antonovich and Gary Burton.

Investment Committee Discussion Items:

Quarterly Report of Investments: Reviewed the quarterly investment report to Governing Board. Committee discussed the current interest rate market for AQMD authorized investments and concluded that the State of California, Local Agency Investment Fund (LAIF) and the Los Angeles County, Pooled Surplus Investment Portfolio (PSI) provided the best investment opportunities for the AQMD at this time. The committee approved this report.

Status Report on Effects of Asia Financial Problems on Investments: AQMD Investment Consultant, Terry McGuire, reported to the Committee that continued problems in Asia could result in low inflation in the U.S. If the problems worsen, there may be an ongoing flight to quality investments resulting in lower yields on U.S. Treasury securities, a slowdown in the U.S. economy, and more actions by the Federal Reserve to lower interest rates. The AQMD’s funds are invested in high-credit quality, diversified and liquid short-term investments. The primary impact of the economic issues in Asia and other parts of the world may be lower investment returns for the AQMD.

Other Business: None

Public Comment: None

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