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ZIRP Strikes Again: Pension Under-Funding For S&P 500 Companies Hits Record

Tyler Durden's picture


The public pension and retirement 'schemes' are in considerable trouble (as we noted here and here) and now, according to a recent S&P study, private companies are at record levels of pension under-funding. Fiscal 2011 shows that the under-funded level for S&P 500 companies' defined pensions reached an epic $354.7 billion - an increase of over $100 billion from 2010 and surpassing the 2008 record of $308.4 billion - and OPEB under-funding reached $223.4 billion. An aggregate $578 billion or 29.5% underfunding or the $1.96 trillion in obligations is increasing as the rates of return are reduced thanks to yet more unintended consequences of the Fed's ZIRP and perhaps most worrying is there comment that "The American dream of a golden retirement for baby boomers is quickly dissipating; plans have been reduced and the burden shifted with future retirees needing to save more for their retirement.  For many baby-boomers it may already be too late to safely build-up assets, outside of working longer or living more frugally in retirement."

S&P 500 Pension Underfunding Compared to Market Levels



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Tue, 07/17/2012 - 15:42 | 2625485 Buzzworthy
Buzzworthy's picture

Work, bitchez!

Tue, 07/17/2012 - 15:50 | 2625549 NotApplicable
NotApplicable's picture

Good thing Obummer signed that pension relief recently. Corps don't have to pay as much into the retirement plans, but instead pay more for "insurance" to the Pension Benefit Guaranty Corporation (PBGC).

All pensions will be nationalized, nuetralized and negativized!

Tue, 07/17/2012 - 16:01 | 2625599 ZerOhead
ZerOhead's picture

Sounds like the man has a plan. Now I just need to order up some ReDS (Retirement Default Swaps) from Goldman and I am good to go...

Tue, 07/17/2012 - 16:05 | 2625628 zaphod
zaphod's picture

The most scary thing is during the last S&P run-up over the past 3 years, the funding level has stayed flat or gotten worse at the same time due to ZIRP.

In each of the past S&P runups in 2000 and 2007, the pension funding level improved quite a bit.

Just imagine what will happen if stocks go down now instead of up. The pensions will be crushed like nothing before. This proves stocks can never go down on a nominal basis, the system won't allow it.

Tue, 07/17/2012 - 16:11 | 2625657 DosZap
DosZap's picture

Just imagine what will happen if stocks go down now instead of up. The pensions will be crushed like nothing before. This proves stocks can never go down on a nominal basis, the system won't allow it.


As a boomer, I assure ANYONE moron still in this market will deserve whatever they get.

Having been bit in the ASS 2x's during my life by the Markets, I got smarter and decided I could take care of ME better than some numb nuts broker,or artifical market,designed to milk everyone one dry.

Tue, 07/17/2012 - 16:19 | 2625701 surf0766
surf0766's picture

Nothing personal. But fuck the boomers

Tue, 07/17/2012 - 16:37 | 2625785 The Big Ching-aso
The Big Ching-aso's picture



Ponzi Pensions worked great when ya retired early.  Like about 20 years ago.

Tue, 07/17/2012 - 18:31 | 2626194 UP Forester
UP Forester's picture

Your pension has been rehypothecated.

Thank you for working for JPMorgan.

Tue, 07/17/2012 - 16:35 | 2625778 Peter Pan
Peter Pan's picture

If you subtract the amount of the underfunding from the gross capitalisation of the S & P 500 you will be knocking off around 5% off its value.

Tue, 07/17/2012 - 17:16 | 2625956 Cadavre
Cadavre's picture

Sounds like the man has a plan. Now I just need to order up some ReDS (Retirement Default Swaps) from Goldman and I am good to go...

Your RDS suggestion just blasted a load of snot and coffee on my shirt! Gave you a "10" for velocity and impact newtons.

Betting, if someone were to actually look, that the govcorps have been deferring taxes on their retirement fund obligations - wonder if there's an ES mini market for deferred govcorp pension plan taxes?



Tue, 07/17/2012 - 16:00 | 2625606 camaro68ss
camaro68ss's picture

Welcome to the life of us 20's somethings who will never see retirment! dam baby boomers and your handouts. screwed the county for us younger folks


get to work bitchez!

Tue, 07/17/2012 - 16:09 | 2625625 Michael
Michael's picture
Nigel Farage "...because stuck inside the Euro, you're going to literally be destroyed"

RNC Confirms: Ron Paul is going to Tampa!

The Republican National Convention is quickly approaching (August 26th). For over the past year, avid Ron Paul supporters have won delegate spots in various state conventions across the country. Through this hard-work, Ron Paul will officially be allowed to be nominated for the nominee of the Republican Party.

For the past three days, Ben Swann (Fox19 Cincinnati) has been in contact with a Republican Rules Committee member. In order for a candidate to be elected for the Republican Party nomination, the candidate must have a plurality in five or more states. If by rule, binding and non-binding policies are applied to delegates, it would still not affect the process of voting for placement of a candidate's name into the potential nominee ballot. Presidential hopeful Ron Paul does have a plurality in five or more states (Nevada, Maine, Minnesota, Louisiana, and Iowa). This means that Ron Paul will be eligible for nomination on August 26th in Tampa Bay.

The Ron Paul Revolution is planning on amassing 100,000+ supporters to Tampa in order to celebrate Paul's 30+ year career in American politics. However, the Republican National Committee senses pressure from the Paul supporters. The RNC has attempted to block access in order to make the convention as exclusive as possible.

The Ron Paul Revolution carries on to Tampa Bay with assurance that Ron Paul has the potential to be nominated. Whether or not Paul does win the nomination, we are all in for something special this August.

Tue, 07/17/2012 - 16:22 | 2625700 ZerOhead
ZerOhead's picture

Hmmm... interesting... a Ron Paul dark horse candicacy emerging at the RNC.

But where is the man's commitment to off-shoring both American jobs and his own made in American money?


Tue, 07/17/2012 - 16:23 | 2625718 the not so migh...
the not so mighty maximiza's picture

Not going to happen now, Romnster flooded the Nebraska deligation.

Tue, 07/17/2012 - 17:22 | 2625990 Abiotic Oil
Abiotic Oil's picture

Doesn't matter.  Ron already has plurality in 5 states.  He can be nominated and appointed from the floor.

No Obomney!

Wed, 07/18/2012 - 08:53 | 2627558 the not so migh...
the not so mighty maximiza's picture

I hope your right

Tue, 07/17/2012 - 17:27 | 2626006 Anusocracy
Anusocracy's picture

Time to form a shadow government with Ron Paul as Pres.

Sort of a trial run of the only political system that makes sense: the competing governments of panarchism.

Panarchism is a political philosophy emphasizing each individual's right to freely join and leave the jurisdiction of any governments they choose, without being forced to move from their current locale. The word "panarchy" was invented and the concept proposed by a Belgian political economist, Paul Émile de Puydt in an article called "Panarchy" published in 1860.[1] The word "panarchy" has since taken on additional, separate meanings, with the word "panarchism" referring to the original definition by de Puydt.[1]

De Puydt, a proponent of laissez-faire economics,[1] wrote that "governmental competition" would allow "as many regularly competing governments as have ever been conceived and will ever be invented" to exist simultaneously and detailed how such a system would be implemented. As David M. Hart writes: "Governments would become political churches, only having jurisdiction over their congregations who had elected to become members."

Tue, 07/17/2012 - 16:24 | 2625684 Sudden Debt
Sudden Debt's picture

first they don't give a fuck about the young generation they thought it was normal to say to the young that it's better to come to terms with the fact that they'll never receive a pension when they grow old.

then... the money runs out... and they demand their pension plus a raise if possible. but there's no more money so they'll receive just enoughh to buy dogfood in cans.

then... their words... about never having to receive a pension become reality.


YEP.. They'll receive what they offered the young kids.

I'm 35 going 36 in oktober (you better all send me a nice card)
and I've got the time to rebuild everything.
and I've got a head start because I've got enough now to retire on in silver.

I've warned a lot of old people, retired or going into retirement. they clearly said they didn't give a fuck.

so now... I won't give a fuck either.

they where the generation of peace in the 70's. but they almost all broke their ideals and voted for the quick buck even as they knew it was a ending story. rest assured, they really knew things couldn't keep up like is was.

they didn't give a fuck that young people couldn't buy the mansions they had for cheap.
they didn't give a fuck that young people had to take 2 jobs to get by and work as a couple going through life with stress when a kid came into their lives.
they lived the dream. and didn't care about their kids.
and now... they'll grow dependend on those same kids....

good luck with that...

what's important for me and how can I profit from it.
that was their crede and that's how they raised us.
I'm raising my kids to be polite, fair in both ways and nothing's for free.
I'm strick and the law is the law in my house.
and guess what... my kids love me like I love them.
they're the most important thing for me and I make sure they know it all the time.

Tue, 07/17/2012 - 16:27 | 2625739 DosZap
DosZap's picture

 Sudden Debt

Put the blame where it belongs.......................Wall Street, and the Feds.

Tue, 07/17/2012 - 20:16 | 2626431 Sudden Debt
Sudden Debt's picture

no, we're also a greedy self centered society who doesn't gives a fuck about anybody or anything else that doesn't give a personal advantage

Tue, 07/17/2012 - 16:24 | 2625722 DosZap
DosZap's picture

Welcome to the life of us 20's somethings who will never see retirment! dam baby boomers and your handouts. screwed the county for us younger folks


get to work bitchez!


Been to work, for 40yrs, and read some history before you point the finger at people who slaved their ass off,because they were just taking handouts bitchez.

After all,dont you KNOW Obammmy say's NO one is successful in business,esp their own,BECAUSE the FEDS do it for them.

Spoken like true Commie.They were right there with me all those 40 yrs,putting ALL those hours, and days in.Sucking taxes and fees, and giving it ALL right back!!.

Funny, I do not remember seeing anything but a bunch of money grubbing whores.(using our $$$$ to pad their retirements, and lifetime bennies).

Always amazed me the Politicos, are quick to take the good, but NONE of the bad?.

Whose tax dollars pay for infrastucture in the US cities?, citizens taxes.

Who paid for the Interstate Highways?.........taxes not from the Feds, because they are vampires, and give only a portion back,or what was OURS to begin with,and WE sent them to start with.

Tue, 07/17/2012 - 20:10 | 2626416 Buck Johnson
Buck Johnson's picture

Yep, and it's going to be ugly.  Because dthe PBGC doesn't pay as generously as the plan that many of them are on.

Tue, 07/17/2012 - 15:58 | 2625588 Drag Racer
Drag Racer's picture

eat your peas bitchez...

Tue, 07/17/2012 - 15:59 | 2625597 Michael
Michael's picture
Baltic Dry Index Implodes, Signals Global Economic Collapse

Tue, 07/17/2012 - 23:08 | 2626815 Vesuvius
Vesuvius's picture

Looks like the Baltic Dry Index has been going up since Feb 2012.  In 2009 it fell from 12,000 to about 1,000 and it's been about 1,000 ever since.

Tue, 07/17/2012 - 16:04 | 2625622 Ineverslice
Ineverslice's picture


Go to ur shed and locate that rusty old pitchfork....and store up some kerosene everyone.

Tue, 07/17/2012 - 17:57 | 2626092 bonddude
bonddude's picture

Look what Pelosi is doing while Calpers/sters is going under and taking city after California after city with it. The comments are priceless.

Tue, 07/17/2012 - 15:41 | 2625486 urbanelf
urbanelf's picture

Does anyone remember the Krugman article where he asked where all the mythical fixed income dependants are?

Tue, 07/17/2012 - 15:41 | 2625487 Pladizow
Pladizow's picture

Just tweak the discount rate - problem solved!

Tue, 07/17/2012 - 15:49 | 2625540 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Is that like tweeking the LIBOR rate?

Tue, 07/17/2012 - 17:15 | 2625488 LawsofPhysics
LawsofPhysics's picture

There is a very real cost for capital creation (despite what Krugan says).  Looks like the pensioners will pick up the tab.  i wonder how many are veterans as well?

Just wait as NIRP comes into play.  Then pensions and 401ks will pay off the debt. 

Tue, 07/17/2012 - 15:43 | 2625492 FubarNation
FubarNation's picture

Retirement is a recent phenomenon in human development.  I'm afraid that it will not be what most baby boomers expect.


I don't expect ever to retire (I'm 45 tomorrow).  I hope my kids don't throw me out to the curb when I'm old and useless.

Tue, 07/17/2012 - 15:54 | 2625559 ZerOhead
ZerOhead's picture

Just so long as you still have money I am sure they will have a place in their hearts for you.

Still it might not be a bad idea to purchase a firearm or two while you can for insurance purposes...

Tue, 07/17/2012 - 15:58 | 2625591 john39
john39's picture

kids won't have jobs either.

Tue, 07/17/2012 - 16:21 | 2625709 Widowmaker
Widowmaker's picture

Whoa, who cares about children all of the sudden!??

The only thing children get is a decimated family structure and all the debt-servitude they can eat.

Fraud street Inc told children to fuck off in the 90's.

Tue, 07/17/2012 - 17:08 | 2625918 Dburn
Dburn's picture

Don't let hope get you down, trust that they will fuck you up.


*Fuck-off Dad. You shouldn't have had us if you were so fucking concerned with your own selfish thoughts of retirement.

*ZH wingnut logic

Tue, 07/17/2012 - 18:41 | 2626226 Tippoo Sultan
Tippoo Sultan's picture

+1, Fubar.

Tue, 07/17/2012 - 15:42 | 2625493 veyron
veyron's picture

Savers are screwed (food prices skyrocketed), pensions are dead, ...

What's next?  401K's are missing?

Tue, 07/17/2012 - 18:46 | 2626243 Tippoo Sultan
Tippoo Sultan's picture

Highly unlikely. The several trillions of 401(k)/403(b)/SEP accounts present a virtually guaranteed "annuity" of taxable funds with which the Government can toy, and extract an insatiably growing tax levee over the succeeding years.

Tue, 07/17/2012 - 15:42 | 2625494 Tijuana Donkey Show
Tijuana Donkey Show's picture

I feel better already, I planned my retirement around using SSI, and other great gov benefits instead of trusting the "private" market. What could go wrong?

Tue, 07/17/2012 - 15:44 | 2625508 Oldballplayer
Oldballplayer's picture

Can I get a low interest rate loan to start my crack business?

Tue, 07/17/2012 - 16:04 | 2625621 slyhill
slyhill's picture

Yes. As long as you take EBT.

Tue, 07/17/2012 - 17:04 | 2625906 Dburn
Dburn's picture

Have you gone though your Mandated apprenticeship training as an *"assistant crack whore" yet?

* Worst Job ever as Described by Comedian Dennis Miller

Tue, 07/17/2012 - 17:41 | 2626051 Rip van Wrinkle
Rip van Wrinkle's picture

I understand HSBC are keen to get into the crack business.Try them.

Tue, 07/17/2012 - 15:44 | 2625514 Dr. Engali
Dr. Engali's picture

I'm sure this will work out well. The boomers will keep on working and the new college debt slaves will continue to go hungry. Way to go Bernank.

Tue, 07/17/2012 - 15:45 | 2625519 Canadian Dirtlump
Canadian Dirtlump's picture

on top of the likes of GE (and Berri soetoro's job creation man crush) head Giggolo Jeff Immelt and others raiding / selling pension assets already this should be just the ticket to guarantee life long employees to either starve early or work till they die.. Win win for the satanic mongoloids behind the curtain.


tuesday mantra, fuck *.*

Tue, 07/17/2012 - 15:45 | 2625520 fonzannoon
fonzannoon's picture

 Always with the baby boomers....

I must say I feel terrible for the baby boomers. I mean the 20 years between 1980 and 2000 was just not enough time for them to benefit from stocks going up 15% a year and real estate exploding for the latter portion of that. It probably was not enough time to get hooked up with some sweet pension from their job (public or private). If you are a baby boomer and managed to not be a part of any of what took place or a combination of all of it then you either had some really tough circumstances or you just plain squandered the opportunity of a lifetime.

Tue, 07/17/2012 - 16:03 | 2625617 derek_vineyard
derek_vineyard's picture


Tue, 07/17/2012 - 16:47 | 2625823 blunderdog
blunderdog's picture

As with most generations, EVEN the boomers (who collectively possessed the greatest wealth, educational opportunities, and most forgiving investment markets) were mostly just a bunch of wage-slaves.

It should really be no surprise that the majority of them did NOT "get rich" despite all the opportunities to do so.

If nothing else, hopefully they ALL got some fuckin' AWESOME health-care payout from the Medicare system. 

An older woman I know (early 70s) and longtime homemaker with no steady work since the 1960s, walked off on a $200,000 pair of knees that would not likely have existed if we hadn't been paying FICA all those years.

Tue, 07/17/2012 - 17:15 | 2625953 Totentänzerlied
Totentänzerlied's picture

Surely you're quoting the Medicare billed cost. Real cost is maybe 1/4 of that. Also, why does a 70-something need new taxpayer-funded knees with maybe 20 years to live at most? How do I get in on that for a knee-level leg prosthetic with 55-65 years to live? Certainly not buying off the seniors with free medical care, nope.

Tue, 07/17/2012 - 18:31 | 2626196 blunderdog
blunderdog's picture

A QUARTER of that?  Uh, no.  That's not how we roll in the States.

I dunno where you're from, but the actual "cost" from a "materials and wages" perspective is probably $150K or so.

But that's not really what matters, is it?

We're talking about an old woman with a decades' worth of a young person's salary in her legs.

That investment isn't going to be producing much return, if you see what I'm getting at.

Tue, 07/17/2012 - 15:47 | 2625531 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Shit is leveraged ad infinum.

Tue, 07/17/2012 - 15:48 | 2625532 Getting Old Sucks
Getting Old Sucks's picture

In time, ZIRP will cause the boomers to exhaust their savings and go on government assistance.  If I didn't have savings, I would qualify.  Baring hyper inflation, I don't anticipate the need for food stamps.  However, if the day comes that I qualify, I will be more than happy to starve the beast.  Get your food stamps BITCHEZ!  STARVE THE BEAST!  This may be the only way to change things now.

Tue, 07/17/2012 - 16:07 | 2625637 slyhill
slyhill's picture

Whatever you do, do NOT exchange your fiat savings for PMs and go boating. You will end up on food stamps for sure.

Tue, 07/17/2012 - 16:14 | 2625673 dhengineer
dhengineer's picture

Yup.  Food stamps and Medicaid when we cannot afford Obummer's "health insurance".  Already working on making only 133 percent of the poverty level here in upstate New York.  Got some gold, some silver, a paid-up house with a well, a big garden, no debt, and a $500 per month housing nut, including taxes, power, and phone.  I actually could live on what SSI supposedly will pay, assuming they are there five or six years from now.

Tue, 07/17/2012 - 15:48 | 2625533 Widowmaker
Widowmaker's picture

ZIRP -- The largest racket going.  Total liquidation of the 99%, incorporated oppression three generations deep.

Its even worse for anyone under 40 -- your lunch is ALREADY gone.

Enjoy eating your own ass -- try some hot sauce.

Tue, 07/17/2012 - 15:53 | 2625565 NotApplicable
NotApplicable's picture

Yep. Notice how that chart looks like a bellows? Sucks the wealth from the 99% right into the pockets of the 1%.

Good work if you can get it.

Tue, 07/17/2012 - 15:59 | 2625596 Widowmaker
Widowmaker's picture

Even more obvious, look WHEN it flatlined.

Same money cartel, but the mission statement changed to "hope and change."

Tue, 07/17/2012 - 15:49 | 2625541 sangell
sangell's picture

I would say that most Americans will have to crawl into their graves as paupers but most Americans will not even be able to afford a grave.

Tue, 07/17/2012 - 15:58 | 2625589 Getting Old Sucks
Getting Old Sucks's picture

Mine ia waiting, headstone and all, money to my son to put my wife and myself there.  Hope all boomers think about this for their kids sake.

Tue, 07/17/2012 - 16:12 | 2625667 NotApplicable
NotApplicable's picture

My kids have to beat the undertaker to my gold crowns.

Tue, 07/17/2012 - 16:22 | 2625717 Getting Old Sucks
Getting Old Sucks's picture

Are you sure they're not Tungsten Crowns?  :-)

Tue, 07/17/2012 - 16:14 | 2625672 poor fella
poor fella's picture

They'll have to legalize burying human bodies in the backyard...

Or find a spot out by the apartment carport.

Or soy....lent...  for lent.

Tue, 07/17/2012 - 16:22 | 2625715 catacl1sm
catacl1sm's picture

I could compost a person.

Tue, 07/17/2012 - 21:32 | 2626630 poor fella
poor fella's picture

Not too bad after running them through a chipper

Tue, 07/17/2012 - 21:36 | 2626639 Mike in GA
Mike in GA's picture

now THAT'S sustainable composting for sure!

Tue, 07/17/2012 - 15:49 | 2625546 fonzannoon
fonzannoon's picture

The baby boomers rigged this whole system in their favor and now wonder why everyone around them are bleeding them dry or trying to.  You reap what you sow.

Tue, 07/17/2012 - 16:04 | 2625624 Getting Old Sucks
Getting Old Sucks's picture

Not all boomers.  I never made more than 75K a year, put four through college, never owned a home, a debt slave till mid forties, debt free after that.  Worked 60+ hours a week and saved.  Wife a stay at home mom till kids were out of school.  Good kids, two nurses, laywer, and advertising exec.  Never leeched on anyone including our shit government. 

Yes, many boomers, including siblings are what you describe, but not all of us.


Tue, 07/17/2012 - 17:08 | 2625921 GCT
GCT's picture

Glad someone said it Getting old.  I did the same dam thing and I am debt free with the exception of property taxes. But honestly this system was set up long before we boomers came along.

Tue, 07/17/2012 - 17:46 | 2626064 fonzannoon
fonzannoon's picture

You are correct it's not all the boomers. It just always seems to be about the boomers, and relatively speaking they had one hell of a run. My generation (mid 30's) has gotten their ass handed to them every 3 or 4 years. The generation before them had the depression.

By the way getting old sucks I am happy for you and your 4 kids. I can only (barely) afford one. I don't leech off anyone either.

Tue, 07/17/2012 - 18:13 | 2626143 Getting Old Sucks
Getting Old Sucks's picture

Thank you.  The best advise I can give you is to strive to be debt free.  Believe it or not that since 1996, I (along with my wife) was able to save enough, that today we can buy a new car, a (cheap) house, and still have sizable savings left.  During those years, we also were able to pay tutions for colleges for the two remaining college aged kids.  After they were done, we saved about 45K a year between the two of us for 7 years to add to our savings by being debt free.  If you have to pay the man debt with interest, you can't save.  Once you save and can pay cash, the man no longer owns you.  THAT"S FREEDOM! 

Tue, 07/17/2012 - 18:52 | 2626231 fonzannoon
fonzannoon's picture

I hear you, although with all due respect it's juts not a reality these days. One of my friends just sat down with a college advisor (whatever that is). They assumed their 2 year old would go to SUNY Binghamton. Generally speaking it is a reasonably priced good in state school. The advisor told them they would need to save $217,000...for that kid. They have 3 kids. I won't even get into the mortgage that they have. The point being is things today are just flat out unsustainable. You could make the argument to go as far into debt as possible and just default like everyone else and hope your issuer gets wiped out.

Thu, 07/19/2012 - 14:07 | 2632937 Larry Dallas
Larry Dallas's picture

Life becomes nothing more than a revolving bank line after college.

Tue, 07/17/2012 - 16:07 | 2625634 DosZap
DosZap's picture

The baby boomers rigged this whole system in their favor and now wonder why everyone around them are bleeding them dry or trying to.  You reap what you sow.

Sure they did,I am POSITIVE 99% of the boomers here, were alive under FDR's administraions.And in 1913.

Tue, 07/17/2012 - 16:37 | 2625784 fonzannoon
fonzannoon's picture

everyone screwed the generation after them is what it sounds like u are really saying

Tue, 07/17/2012 - 21:35 | 2626638 ali-ali-al-qomfri
ali-ali-al-qomfri's picture

what came first the Boomer or the Nest Egg?

Tue, 07/17/2012 - 15:53 | 2625564 ThunderingTurd
ThunderingTurd's picture

Turning 31 next month and have a strong PM balance built I would think.  I belive I will work for the majority of my life.  Retirement is going to be the trainwreck that I am about to watch my parents go through.  It isn't going to be pretty and I hope my kids learn something from it.  People in general are going to need to adjust their frame of reference.  Things are going to be so different over the next two decades.  It seems so obvious.  

Tue, 07/17/2012 - 16:09 | 2625647 Getting Old Sucks
Getting Old Sucks's picture

Try to stay debt free.  I preach that to my kids.  Three of four listining.  Debt will keep you enslaved.  When you owe money, you are pledging future labor.  As that debt grows, so does your pledge of future labor.  If you are 60 and have pledged labor till 70?....

Tue, 07/17/2012 - 16:34 | 2625754 poor fella
poor fella's picture

Doesn't matter how much we save. The system is completely fucked, game over WITH ONE accident or health issue..  Totally fucking ludicrous. Going to be interesting with structural unemployment where all the money to feed Big Pharma is going to come from.

Whether you are a deflationist or inflationist, we're dancing a jig on a balance beam over an abyss. It doesn't matter to which side you fall.

By not preparing, people will be pleading for a global debit card filled with free shit every month (a 5x5 room, bread, & dirty water). Possibly steady work similar to the movie Metropolis, moving swinging arms to match random lights for 12 hours a day. Revolutions start like this, when the BEST the current system has to offer is no better than death, anarchy, but the chance to rebuild.

Tue, 07/17/2012 - 15:54 | 2625569 Dr. Engali
Dr. Engali's picture

Just print up some money Ben and fund the shortfall. It all comes from thin air anyway.

Tue, 07/17/2012 - 15:58 | 2625590 ATG
ATG's picture

No problem.

Just put pensions into Treasuries targeting 1.7% TYX and 0.5% TNX...;

Tue, 07/17/2012 - 15:58 | 2625592 RobotTrader
RobotTrader's picture

Verizon has one of the biggest pension liabilities and that stock is hitting 4-year highs.


I guess the consumer must have his $599 Galaxy S, iPhone4, tablet, and unlimited data plan come hell or high water.

Tue, 07/17/2012 - 16:02 | 2625612 somethingisrotten
somethingisrotten's picture


Tue, 07/17/2012 - 16:40 | 2625803 poor fella
poor fella's picture

OMG!! I had to thumb that up, because no matter how F-ed up that statement is - IT SEEMS TO BE TRUE!

Things are absolutely Oz....   Zardoz, more like it.

Tue, 07/17/2012 - 17:11 | 2625934 GCT
GCT's picture

+1 Robo for a change.  The sheeple must be kept in their gadgets and reality TV or they will riot!

Tue, 07/17/2012 - 16:02 | 2625613 Hype Alert
Hype Alert's picture

It's like before the tech crash when people were claiming Earnings don't matter.  Now, nothing matters because the FED is going to print.  Pensions?  Who cares, the FED is going to print.

Tue, 07/17/2012 - 16:02 | 2625615 DosZap
DosZap's picture


Tue, 07/17/2012 - 16:03 | 2625619 resurger
resurger's picture

I just love it when the FED is ready for double ass penetration , on Bonds & on Stocks

Tue, 07/17/2012 - 16:07 | 2625639 Unprepared
Unprepared's picture

Huh! Eat that you moronic baby boomers... and thank you for the wonderful future you left me,

Tue, 07/17/2012 - 16:10 | 2625650 Jalibb
Jalibb's picture

Tired of being diesel for this market bulldozer.

Tue, 07/17/2012 - 16:11 | 2625659 RhoneGSM
RhoneGSM's picture

It's going to be fine. They all bought nice safe indexed annuities.


Tue, 07/17/2012 - 16:30 | 2625669 Peter Pan
Peter Pan's picture

Americans will have their pensions halved and their post retirement life span also halved. It's all part of bringing medicare and social security under control. State sponsored genocide through financial means.

Tue, 07/17/2012 - 16:18 | 2625691 Kali
Kali's picture

But, but I thought corporations were holding onto record  cash and posting record profits, the CEOs sure are making the money.  Fucking pussy baby boomers.  Fight for your  money!   You just work your ass off for the very people who are ripping you off and whine like little babies while you slowly go bankrupt and starve as they steal your money?  How dumb are you

If you have enough in your pension fund/401k/whatever to last the rest of your life, you better get that money out NOW.  Even if it means quitting your job.  You think it's magically going to be there when you retire and you will get your SS too?


Tue, 07/17/2012 - 16:37 | 2625783 Getting Old Sucks
Getting Old Sucks's picture

I would guess that you are of the Z generation?  The X generation is up at bat.  The X generation is as big as the boomer generation, so don't concentrate on the boomers too much.  As the boomers die off, the X Gen will be the next so called problem.  X & Y have to change things or the Z(ero) Gen is totally screwed.  We better all stop the in fighting and join forces to change things for the good of us all.  TPTB is orchestrating this generational warfare, don't fall for it. 

Tue, 07/17/2012 - 18:38 | 2626178 Kali
Kali's picture

Actually, I am a "late" baby boomer, on the cusp of Gen X and BB.  I am not promoting intergenerational warfare, I am trying to goad people to take action and stop waiting for someone or something to save you.  The only person who can is YOU!  If you act like a slave, you will be treated as one.  Seriously, why would you keep working for anyone who takes all the profit which you helped generate, not pay you wages to keep up with the cost of living  and then allow them to steal the pension/401k they promised you for retirement?  When I was growing up that was called being a sissy.   Or you like sucking your massa's dick?  Not smart or ambitious enough to start your own biz ? Fuck these people.  I only wish I had figured it out sooner.

 I am in the group of  boomers to have to wait til 67 to start collecting SS- not that it will be there anyway.  I will keep pushing to opt out and fight (pie in the sky -I know) to get the money I paid in back.  Fuck these assholes.  If someone tried to rob me or my home I would fight it.  Why do people not fight their employers ripping them off?  Does anyone remember what a wild cat strike is?  Try it, it can actually be kinda fun.  No risk, no reward.

Tue, 07/17/2012 - 18:56 | 2626264 Getting Old Sucks
Getting Old Sucks's picture

Sorry to have mis-gauged your Gen.  Wish you well. 

Tue, 07/17/2012 - 16:18 | 2625692 surf0766
surf0766's picture

We need to fix out roads and bridges. So more checks for that for the 10000 th time. That will fix the pension thingy

Tue, 07/17/2012 - 16:32 | 2625763 yrad
yrad's picture

Is there any good news out there? This perfect storm has 11 fronts. Unstoppable.

Tue, 07/17/2012 - 16:34 | 2625774 yrbmegr
yrbmegr's picture

I guess these corporations can choose to breach their contractual obligations to their retirees in order to avoid paying taxes in the U.S.  Perhaps some enterprising attorney will file some class-action breach suits on behalf of those retirees.  Underfunding of $357 billion, with $700 billion in punitive damages, you're looking at a collection of judgments worth, perhaps, a trillion dollars.  Follow that up with some chapter 7 forcible bankruptcy suits, and we've got ourselves a ball game.

Tue, 07/17/2012 - 16:55 | 2625849 Dburn
Dburn's picture

Might be some good political theater to allow companies to repatriate their overseas cash with zero taxes, as long as it's used to fund their underfunded pension plans.

Dave Fuck-em, CEO, NANC (National Association of Nervous CEOs)

"Uh, Uh Yeah...uh, Emmelt uh Jeff, what do you think? "

Jeffry Immelt, CEO of GE and US JOBS (Jacking-off O'Bama Sucks) Czar

" Hmm, don't know, interesting problem to solve for the 1000 experts we have in tax avoidance".

Unfortunately, there is no confidence in US Regulators that they would actually check to see if they had used the cash for that purposes. The quiet understanding would be "well you'll find out if we go belly up or do an asset sale and hand of the pension fund to the Taxpayers. Of course the people in charge will be long gone by then or at least long gone in US corporate speak as "They left yesterday to spend more time with their families".

It might make for a nice gotcha moment on the campaign trail.

Tue, 07/17/2012 - 17:18 | 2625965 blunderdog
blunderdog's picture

Didn't the corporations already sell off the pensions to others for management?

It's all the same guys.  If they won't put a bankster in jail, it's a safe bet you can't win a civil judgment against 'em, either.

Tue, 07/17/2012 - 16:38 | 2625791 Budd aka Sidewinder
Budd aka Sidewinder's picture

C-Suite Meeting in Hamptons:

'Should we go ahead and fund the pensions or pay ourselves bonuses?'

slight pause.....



Tue, 07/17/2012 - 16:57 | 2625868 Catullus
Catullus's picture

Utility industry is going to pushing all of their pension costs on to ratepayers. Yay unions!

Tue, 07/17/2012 - 17:02 | 2625897 Chippewa Partners
Chippewa Partners's picture

O thinks we will have shovel-ready pensions too!

Tue, 07/17/2012 - 17:05 | 2625908 erheault
erheault's picture

Dont worry the government insured the pensions that fail,, Your check will be in the mail even if that fails we still have the local terrorist camps to fill up free room and board for life and the gas chambers for those who are not happy, It worked for Germany so there is no reason it canot be used here

Tue, 07/17/2012 - 17:06 | 2625912 Weyland_Yutani
Weyland_Yutani's picture

People should stop buying a lot of crap and save as much as they can, preferably in physical silver/gold. Look around in your home and see how much crap you have accumulated during the years.

Tue, 07/17/2012 - 17:18 | 2625968 shovelhead
shovelhead's picture


I'm looking forward to the retelling of Woodstock stories with my fellow boomers around the campfires in the hobo jungles of the New America.

Pull up a bucket, my friend, and have a Gubmint cheese sandwich.

Tue, 07/17/2012 - 17:21 | 2625982 zrussell
zrussell's picture

The little lady and I worked 35 years each. Now we have obtained our safe and secure retirement plan- the CKK.











Couple's Kevorkian Kit

Tue, 07/17/2012 - 17:28 | 2626010 Fix It Again Timmy
Fix It Again Timmy's picture

Refrigerator box and plastic sheeting  = retirement home...

Tue, 07/17/2012 - 17:40 | 2626049 hellas4life
hellas4life's picture

can we get an unfunded liability # for the next 75 years? 

Tue, 07/17/2012 - 17:58 | 2626097 SmittyinLA
SmittyinLA's picture

The state of New mexico recently "faked" an audit of their public employee benefit fund, unfortunately the firm that alledly "faked" the audit didn't get the memo that they "faked" the audit, and when a real auditor asked them about the report that they allegedly wrote, they denied they did it (they didn't do it) somebody in state govt submitted a "fake audit".   

Wed, 07/18/2012 - 07:09 | 2627393 wattsnotsaid
wattsnotsaid's picture

How much of this "underfunding" is not due to underfunding but rather due to the fed setting interest rates at 0-2%.  

Let's see Government needs cheap money to pay its bills including gov't pensions so it screws retirees buy cutting their income.

Retirees and prospective retirees spent less and decide to work longer which increase unemployment.**

Does this sound like a death spiral?


** If  the 90M people over 50 spent $3000 more per year employment would increase 2% at $100,000 per job.

If half the people  60-65 stopped delaying retirement, it would increase employment 2%. 

8% unemployment minus 2% minus 2% equals 4% unemployment.  Problem solved by having fed incresae interest rates.



Wed, 07/18/2012 - 10:26 | 2627912 Antifaschistische
Antifaschistische's picture

The expected return rate declined to 7.60% from 7.73%   ("expected" means, we really hope in our wildest dreams)

Fixed income allocations increased from 35.9% to 40.9%

I'd love to see the ACTUAL RR on FI investments.   This is comical.  Do they not see the massive interest rate risk they've onboarded?  It's the worst possible scenario.  Real return rates on FI investments in gutter and fully exposed to a bond market implosion.  All at the time the baby boomers are drawing down pensions.....this will be fun to watch.

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