MutualFundWire.com: July 6, 2000

MutualFundWire.com

The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication

Thursday, July 6, 2000

July 6, 2000

More on the GAO fee proposal
The Wall Street Journal provides solid basic coverage of the report but adds nothing new to readers who have taken time to look at the report itself. The coverage is unlikely to leave fund investors feeling that this is a major issue. Bloomberg also offers "just the facts" coverage in its syndicated article in the Dallas News. Coverage in CBS.MarketWatch emphasizes that while the GAO is calling for more disclosure, the industry thinks that current rules are adequate. Coverage can also be found at TheStreet.com

Goldman files for secondary
From Wall Street Journal
Goldman Sachs Group Inc. has filed for a secondary stock offering of 40 million shares, currently valued at about $3.8 billion. The offering, which could be completed as early as August, accelerates the time-table under which some partners can sell shares from three to five years to just one. Sumitomo Bank Capital Markets Inc. plans to sell 12.6 million shares, and Kamehameha Activities Association lans to sell 11 million. Goldman's retired partners plan to sell the remaining four million shares. The reason for offerinf the shares is to increase the float. The offering will increase the company's float to 25 percent of shares from 17 percent.

Stock funds top S&P 500
From Los Angeles Times
The average stock fund gained 3.5 percent in the first half of the year, compared to a loss of 0.5 percent for the Standard & Poor's 500 Index. Morningstar found that 58 percent of all equity funds topped the index for the year's first half. One explanation for the managers strong performance -- they have a larger weighting in smaller cap stocks than the index.

401k deposit lags in the news
From Detroit News
The paper takes the side of participants who discover that their 401(k) contributions take up to six weeks to hit their account, and then get steamed when they discover that this practice is legal. The paper quotes Virginia Smith, director of enforcement for the U.S. Department of Labor's Pension and Welfare Benefits Administration (PWBA), as saying that the employer cannot benefit from the delayed deposits. "If his employer is just hanging on to the money, that employer has a big problem," she said. "They can't use it in their own business, and any interest it is earning should be credited as earnings of the (401(k)) plan." Smith also urges employees who believe that their employer is breaking these rules to cal the PWBA. Her number? 313-226-7450.

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