@aimeesblog sends a great article from Bloomberg: Hidden Pension Fiasco May Foment Another $1 Trillion Bailout.

Pension funds are major investors -- returns from the market are a key part of the model. The funds have been leaning on long-term stock market returns of 8 percent or more, but in reality getting closer to 3 percent, or less. From Bloomberg:

"It's pitiful, isn't it?" says Frederick "Shad" Rowe, a member of the Texas Pension Review Board, which monitors state and local government pension funds. "My experience has been that pension funds misfire from every direction. They overstate expected returns and understate future costs. The combination is debilitating over time."

Guess who gets to help when the pension funds come up short?

categories: Recommended Reading

11:11 - March 4, 2009

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