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the current values of high-growth stocks is compelling. Turnover in the portfolio averages about 100% -- stocks are held an average of about 1/3 the life of an individual account. The characteristics of the total portfolio are the same now as they were five years ago.

Mr. McHenry thanked Mr. Nicholas and Mr. Wiley, whereupon discussion commenced on the four managers interviewed. He reminded the group of the motion made two years ago to try and seek diversification of the endowment through the addition of specialty managers.

Mr. Moriarty stated his preference for Wellington's Over-the-Counter Fund and Nicholas-Applegate respectively. Mr. Mott pointed out that the track record of Mr. Nicholas was a composite over many years, not just the record at Nicholas-Applegate. There was a consensus that Aronson and Fogler was overly automated, average in long-term performance, and that their investment philosophy differed from the Institution's investment objectives.

Mr. Mott stated a preference for Wellington's OTC fund and suggested going with an individual account rather than the mutual fund, should they be selected. He thought Brandywine was good, due in particular to Mr. Hitschler, but their performance was about average. Mr. McHenry pointed out that Brandywine was not a "small cap" manager and stated his preference for Wellington, specifically for Mr. Binkley Shorts.

The Committee agreed on the selection of Wellington and to follow Mr. Mott's approach with an initial investment of $10 million to be drawn from existing managers at the Treasurer's discretion. The Committee also agreed to continue to review additional firms over the next few months, with an eye toward adding two additional managers, each for $10,000,000. Staff is drawing up a composite list of potential candidates from a wealth of material received as the result of an unsolicited comment in the Money Manager Letter, an industry publication.

The meeting was adjourned at 5 p.m.

[[underlined]] THE SECRETARY'S REPORT [[/underlined]]

CONDITIONS IN PANAMA

The Secretary noted that during the recent outbreak of war in Panama the facilities of the Smithsonian Tropical Research Institute were largely unaffected, though eleven scientists associated with the Institute were taken hostage, forcibly marched, and later released. In the few short weeks since the turnover in government it appears that the greatest dangers and administrative obstacles may stem from a lack of Panamanian governmental infrastructure, which could give rise to local disorder, poaching, and other