Turbulent times for the nation have left us all reeling over the magnitude of the financial crisis — a situation that was clearly avoidable. The bailouts required to keep the whole financial system from imploding are staggering. At last count it was close to one trillion dollars ($1,000,000,000,000) and the kicker is that no one is positive what will fix the mess.
And where was the oversight, the stewardship, the checks and balances? It was nonexistent — a glaring failure of the system supposedly designed to protect us all.
If we actually survive this financial crisis — and at this writing it is no slam dunk that we will, without having to go through some excruciatingly painful times — we must fix the system that allowed the greed to ride roughshod over good sense and accountability.
So you may be asking yourself: how is Local 802 faring so far during one of the worst financial debacles in our nation’s history?
In short, pretty well.
We did experience some limited losses during the first half of the year, but while the stock market was truly tanking in October, we were coincidentally in the process of preparing to transfer some of our investments to new investment advisors. Many assets were being held in liquid money market accounts so they would be ready at transfer time. Because of this, we have not experienced the recent devastating losses incurred by many others, as of this writing.
While we would like to take credit for incredible foresight and astute investing acumen, truth to tell it was really just a matter of timing. Nevertheless, the timing was fortuitous.
Of course many financial pundits are saying we are now only at the beginning of this national nightmare and that there is more bad news to come. The Local 802 officers are doing our best to protect our union’s assets and will continue to act prudently during these financially turbulent times.
In Allegro, you will find our audited financial statements for the six-month period Jan. 1 to June 30, 2008. As you can see, we were in the black, with an increase in net assets of $393,163. Keep in mind that the audited numbers are as of June 30, 2008. The current global financial crisis had not yet occurred. (One other note: the June 30, 2007 financial statement has been revised to reflect the new method of accounting begun last year by our accountants to afford greater transparency to our members. This allows a better comparison to our financial position on June 30, 2008.)
Our hope is that the financial crisis begins to reverse itself before work in the music industry is adversely affected. Should a work slowdown come to pass, a significant reduction in work dues income could have serious implications for our bottom line. Only time will tell.
In the upcoming months, we will be receiving competitive bids on our computer software upgrade project. In addition, we are gradually replacing computer hardware which will be incapable of handling the system requirements needed to run the new software. These additional expenses will be incurred over the next few years.
On the expense side, we have recently taken steps to combine some staff positions (through attrition) which should help reduce our future payroll expenses. We will continue to contain expenses where possible in an effort to keep our union financially secure.
As always, if you have any questions, please feel free to call me at (212) 245-4802, ext. 105.