eastern district of wisconsin milwaukee county, employee

A Guaranteeing is a -- is a strange word. Guaranteeing -rather
than using the word guarantee, I would express it
this way: They're saying based on everything before them,
their expertise and what they're looking at, this is what
they expect. Is that going to be 100 percent accurate?
Probably not, but it should be in the ballpark.
Q Right. I mean, in the ballpark over a long period of time
perhaps. But you understood, didn't you… that there
might be -- at any point could be a down year in the
market or several down years?
THE WITNESS: I think everyone understands that in a particular
year you can have a down year. 66
Meanwhile, Dobbert testified that he understood at all times that the investment return
assumption Mercer was using in its formal annual valuation reports for the ERS was 8.5%, not
12% or 13%. Dobbert went on as follows:
Q And you noted of course that -- in the last paragraph he
says, "Of course you must recognize interim volatility is
not only a probability but almost a certainty. We still
expect relative spikes and valleys to occur." That wasn't
telling you something you didn't already know, is it?
A You're correct. 67
Indeed, County representatives have uniformly acknowledged the stock market’s inherent
unpredictability. Thus, Supervisor Michael Mayo (“Mayo”) testified that “when you look at
the history you know there are going be to [sic] lows, ups and downs in the market. Nobody
thought we would be in the market four years down at the present moment.” And Borkowski,
when asked about Mercer’s advice, testified that “[Mercer was] making some suppositions.
They did not suppose in the mid-nineties the market was going to go as crazy as it did. So, you
know, you take this stuff with a grain of salt. All right. Just because somebody says something,
they don't have a crystal ball. They don't actually know what's going to happen.” 68
66 PFF, 133.
67 PFF, 134-135.
68 PFF, 136-137.
QBACTIVE\6280487.1 30
Case 2:06-cv-00372-CNC Filed 06/09/2008 Page 30 of 52 Document 110