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US Public Pensions Up 6.2% in Q3
Kenneth Barry of Reuters reports, Assets of public pension funds up 6.2 percent in Q3:
The The The Public-sector The The recent losses by Some San Diego Mayor "It's pretty unrealistic You can download the report by the US Census Bureau by clicking here. The results are not surprising given that the S&P 500 gained 11.3% in Q3 2010. What remains to be seen
value of assets held by the 100 largest U.S. public pension funds rose
6.2 percent in the third quarter from the prior quarter, reaching
their highest level in two years, a report by the U.S. Census Bureau
said on Wednesday.
value of the assets held by the state and local pension funds also rose
5.2 percent from the same period a year earlier, marking their fourth
consecutive year-over- year quarterly increase, the report said.
report said the value of the investments, whose returns help pay for
the pension benefits of millions of retired public-sector workers, was
more than $2.5 trillion last quarter.
retirement systems across the nation have been clawing their way out
of deep financial holes created by the recession and turbulent
financial markets, and at the same time have been facing increased
scrutiny about their current and future costs.
California Public Employees' Retirement System, the biggest U.S.
public pension fund, for instance, saw the value of its assets fall to
as low as $160 billion during the financial meltdown from a peak of
$260 billion. The pension fund's assets currently stand at about $221
billion.
public pension funds and the size of their projected liabilities are
fueling debates in statehouses and local government chambers across the
nation over requiring public employees to contribute more to their
pensions and reducing benefits for future public-sector workers.
officials are also calling for doing away with traditional
defined-benefit pensions altogether for government workers and offering
government employees retirement accounts similar to 401(k)s common in
the private sector.
Jerry Sanders, for instance, is planning to ask voters in California's
second largest city to approve a measure for a such shift to lower its
costs.
to think that we're going to have defined-benefit plans, at least on a
local level," Sanders told Reuters in a recent interview.
In other words, public pensions rode the beta wave higher in Q3 but
still underperformed the broad market index (understandably so since
they're not just invested in stocks).
whether public pension funds can continue riding the beta wave higher in
2011. As a friend of mine told me today, "when everyone is bullish on
stocks, they're usually wrong". My thinking is that this year will be
all about alpha, with some beta juice in a few sectors. I'm recovering from Lasik eye surgery but will try to post my outlook 2011 this week.
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I wonder if the increase is the result of market returns...as opposed to the decline in value stopping it's descent and normal contributions into the system accounting for some percentage of the increase?
Mathematically it's extremely hard to recover from a devastating capital loss on just what's left over after the loss...ie a 50% loss requires a 100% gain just to regain what was lost...leaving aside any time value lost...which can never be recovered.
Anyways...I'm glad you're on the road to recovery Leo.
It doesn't matter how well the pensions perform in spite of every attempt to sabotage them, the screeching of those who wish to steal them from the workers who earned them will never stop.
Yes sir, getting those pensions fat again, for the next take down and/or appropration and seizure by the US Government , under some austere reason, such as national security. Yep, keep up the good work, pension fund boys. Making more money for the new owners, who will take their funds very soon.
Already in place. The Pension Benefit Guarantee Corp(PBGC) setup to take over underfunded pensions to "protect individual retirees". Gonna make TARP look like chump change.
A speedy recovery Leo! Look forward to your next post!
Be Well, looking forward to your 2011 Outlook.
and who said QE2 was not successful.....this is the only result Bernanke was worried about, because if he loses the pension ponzi scam than all hell really will break loose
Be well, Leo. Everyone I know has been happy with the outcome of their Lasik.
Wow...6% on their 2.5T only cost 2T!
Pumping pension values (in depreciating USD's) is one of the primary reasons behind QE2. Middle class methadone.
Bernanke/Geitner/Summers could give a damn about unemployment.
They just understand that if private and public defined benefit plans are unable to meet their obligations, the middle class proletariat may finally wake up and start 'demanding justice'...
...and the Fed's Wall Street 'client' bankers will be the target.
Well I guess the POMOs have been a bailout of public pensions.
401Ks too, so I'm good with that as long as everybody knows when to get out of dodge.
why do you have so many medical problems leo? wear some shades and heal up quick. fortunateley eyes can do this pretty fast.
Bonne annee, Leo.......nice post. Thank you.
You definitely put 'restoring social order' into context. Again, thank you for the insights.
And here in California, the local paper in my part of town issues this:
"County officials expect more money from property taxes in 2011-12"
Yes, this is all they know. Legalized extortion is the game and this is the only game they know. Home ownership in this country has always been a myth. We never own property. We just rent it from the state. The day you stop having to pay taxes of any kind is the day you will understand liberty.