Inside the Wall Street system.
Outside the Wall Street system.
a new class of financial decision-makers
making financial decisions within
Today, pensions are generally classified as Institutional Investors.
They (and we) are taught to believe
that they have a fiduciary duty
to do the best they can
trading securities within the Wall Street system
of speculation on growth in future valuation.
Forty years ago, they (and we) were taught to believe
that trading in securities violated their fiduciary duty.
It was against the law.
Why did it change?
What have we learned?
Deploying pension money
– and other social benefit super funds –
into the economy as equity for enterprise is
good for our superfunds,
good for enterprise,
good for the economy, and
good for society.
Doing so through the Wall Street system is not.
we apply simple set theory to recognize that pensions,
along with university endowments and endowed foundations,
are really a subset of Institutional Investor,
a special class of financial actor
that we might call “superfiduciaries”?
Applying Set Theory to See the Subsets
Within the Set of Institutional Investors
Plain, old ordinary fiduciaries act for specific individuals under private or family trusts.
Superfiduciaries, like pension funds, act for entire populations of people, under charters of public trust.
Investment Managers are professionals, who trade on their professional expertise, professionally, under contracts for professional services.
Pensions and other superfiduciaries are not themselves Wall Street professionals,
even though today they are the largest consumers of the professional services of Wall Street professionals.
But if pensions are not just Wall Street traders, what are they?
And what can and should they be doing?