Does anyone else consider the subject matter of a recent July 6th HSV Voice article entitled “Finance Committee to consider various investment options” concerning? …Bernie Madoff was a broker-dealer! The problem with supposed protections subsequently enacted by the SEC regarding broker-dealers is that they depend on the honesty of each broker-dealer and their accountant. Could I be correct in vaguely remembering learning somewhere something like our organization is not allowed to jeopardize our reserves by deliberately exposing them to the financial markets, but rather required to hold them as safely as possible?
Mrs. Katherine Miller
Click here to read, “Finance committee to consider investment options.”
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Hot Springs Village Investment Policy pages 100-101 (Approved 7-15-20)
Hot-Springs-Village-Investment-Policy-pgs-100-to-101-Policy-GuideHot Springs Village Investment Policy (5-19-04)
AR-HSV-POA-Policy-Guide-revised-5-19-04* * *
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Mrs. Katherine Miller
07/08/2021 — 9:52 pm
Cheryl, Thank you very much for publishing this concern. I found a helpful article at https://www.hoamanagement.com/investing-hoa-reserve-funds/
Gene Garner
07/09/2021 — 11:12 am
If we consider the financial track record of the BOD over the last 20 years, the last thing they should be doing is investing our reserve funds. How many bad financial decisions have they made?
The ones that come to mind are the CMP, renovating the De Soto Club restaurant, the Troon contract, the Luxury RV Park, the Gate Software fiasco, the $6 million upgrade to the water plant and the list goes on.
There are some safe harbors for these funds, like government bonds but whats to prevent them from investing in an Enron-like scam or another Ponzi scheme like Bernie Madoff and losing everything?
If the BOD can’t manage our budget how can they choose the safe investments for our reserve funds? It’s a gamble that we’re sure to lose.—Gene
Lloyd Sherman
07/10/2021 — 3:29 pm
We should not be considering investing any of our funds that are subject to market position that have a chance of putting our funds at risk. The issue at the end of the year was that we had $11 million in bank accounts that are only insured up to $250K. What would have happened if one of those banks failed? And they do. Of more concern is that it doesn’t appear our auditing firm even apprised the Board of the situation. Or, the Board didn’t read the report. One of the two. A CPA would like have already handled this issue before an audit happened.
Mrs. Katherine Miller
07/09/2021 — 2:53 pm
Broker-dealer was not on the list until, as I have just learned, in mid-July 2020, Chapter One, Article 20 of the HSV POA Policy Guide was rescinded, annulled, and replaced by Chapter Nine, Article 1.
Walter Chance
07/09/2021 — 3:21 pm
I would want a transparent and detailed plan as a member. US Treasuries. US Bonds. Not sure this is needed however I am willing to hear the proposal. I also would hope the BODs would let the membership vote on it once details are known.
Wes Smith
07/11/2021 — 9:08 pm
I commend & support these financially prudent ultra safe investment alternatives.
Highly recommend Vanguard Admiral money market funds . Solid track record, high liquidity, lowest commissions , no load funds all far better options than brick and mortar banks are able to compete with and yes fully insured.
Fidelity, TRowe Price & Charles Swabb all have similar stellar options with slightly higher commissions
Shop it around diversity your portfolio & reap the benefits of ultra low risks of a basket of fixed rate or variable rate ROI’s .
If your unsure how to spread your investments then all the aforementioned brokers will offer their expertise based on risk tolerance.
Again , I fully endorse these outside the box strategic investment practices. If your just sitting on $ 11 M in cash reserves you should at least be keeping pace with cost of living increases & inflation otherwise your cash position is technically loosing value year after year put it to work & let it accumulate wealth ASAP.
Finally , I would not sink lump sum in but diversify in 4 to 6 funds and dollar cost average your deposits in to further spread out your risks of buying at various entry points . Same strategy applies when ever your withdraw.
Cami Dubbs
07/14/2021 — 9:13 am
Totally agree with Mr. Smith, large banks have qualified officers in their Treasury Management departments that would be worth discussing the portfolio for long term and short term investments.
Kirk Denger
07/19/2021 — 11:01 pm
This should have been collecting interest in 5/2020, never happened. Talk, Talk, Piss.
Mrs. Katherine Miller
07/21/2021 — 12:54 am
How was this change pointed out in May 2020?
David Kirsch
07/22/2021 — 5:05 pm
And exactly how is this keeping up with inflation? Asking for a friend….
Tom Blakeman
07/26/2021 — 5:50 pm
That’s the basic question. And the answer is it probably not going to keep up with inflation. Particularly if we are going into a Jimmy Carter type of economy, which seems to be the case. But the goal is to try and mitigate the problem safely and as best as possible. It appears we have nobody who is astutely managing this at all.