Weathering Wall Street

The most recent figures from West Virginia's investment portfolio suggest that "the estimated exposure from stocks in the likes of Fannie Mae, Freddie Mac, Lehman Brothers and AIG amounted to $10.9 million by Friday's market closing," The Associated Press reports.

That's a fraction of a percent of the state's more than $11.2 billion in invested assets, and the state Investment Management Board has told Gov. Joe Manchin and other state officials that its widely diversified holdings help insulate from such turmoil.

"That is important in times like this, because diversification is the primary means of protection for a long-term investor when markets go south." Craig Slaughter, the board's executive director, told AP, adding that ""We also know that the U.S. economy is not going to be in a permanent recession. There will eventually be a recovery, and you have to be invested in the markets when that happens to accrue the benefits."

The article also notes that this month's tumult among Wall Street institutions "comes on the heels of a disappointing fiscal year for West Virginia's investments. The year ended in June with a $643 million decline in portfolio assets, a 6 percent loss. The target had been, and remains, a 7.5 percent return on investment."