National Pest not reading da blogs

As the Globe and Mail runs through the final days of its “Top Money” blogs poll (vote for us here), it is telling to read a piece in the National Post Pest that confirms that whatever the Pest may be as a newspaper, it doesn’t stay on top of the blogs.

How do I know this? Earlier this week, the Pest ran a story about compensation at the CPP Investment Board. One of the journos angles is that CPPIB managers need to be paid large bonuses, for if they weren’t, the CPP would have to spend even more outsourcing the role to external managers:

Going “cheap” on talent would save a few million in bonuses, but it would also add 10s of millions of costs to the running of the [CPP] plan because the fund would be forced to rely more on outside fund managers and consultants who charge high fees to handle alternative assets such as private equity and infrastructure funds.

I don’t think the authour of the article is aware that the CPPIB has already committed over $30 billion to external private equity fund managers (see prior posts “Supersized private equity allocations at CDP and CPPIB?” February 10-09 and “PE consumed 61% of CPPIB quarterly payroll contributions in Q4” May 24-09). A full 32% of their (our) assets under management are in the one category. How could you “rely” more on external PE managers than that?

Changes the argument somewhat, doesn’t it?

MRM