Back in 80's, the Repub legislature paid some NYC financial firm to get the desired results that said the stock market was going to keep going up forever and state didn't need to keep making their agreed to share of pension contributions. Now it's going broke, they don't want the blame, trying to blame the now defunct NYC firm. Ak has 70 bill in bank and oil for hundreds of years so doesn't matter much, but our own crooked Repubs are responsible for this and now they are trying to crawl under the rug and hide.
Palin had the guts & straight up integrity to fund some of it when oil was $140/barrel. She knew the Repubs would face the wrath of the Alaskan people someday for their filthy crooked games. I'll hand that to her, she got big ones when it comes to saying wrong is wrong and we're going to straighten this crap out.
The next market decline will trigger a crisis. Even without chasing high beta portfolios and other risky investments, the portfolios pose huge risk to taxpayers and retirees.
The private sector separates the growth (working years) and income (retiree years) parts of retirement assets. If you want a lifetime income guarantee, you can purchase an annuity product. The portfolios supporting these products invest in relatively high grade corporate bonds. The market for these products is rather small in the US because most individuals do not like the relatively low long-term yields of these investments. Most individuals choose to manage their own portfolio during retirement without an income guarantee. The performance of the portfolio during the first few years is crucial for not outliving the portfolio.
The public DB industry comingles assets to support current workers and retirees. Some of the money is invested rather safely but the majority is invested aggressively. A market decline will hit the assets to support current retirees very hard. When a pension plan indicates that they need an average 8 percent return, they are talking about the entire portfolio to support both current workers and retirees. Realistically, the portfolio to support retirees should earn perhaps 5 to 6 percent on relatively safe investments. A market decline will put the earnings on the retiree part of the portfolio perhaps underwater. More troubling, the retiree part of the portfolio is growing rapidly while the current worker part of the portfolio is growing very slowly if at all (due to worker reductions).
Pension agencies are recklessly managing assets to provide the illusion that the benefits can be obtained without much risk to taxpayers. The private sector cannot manage retirement assets in this manner if required to guarantee income streams at retirement.
The next market decline will trigger a crisis. Even without chasing high beta portfolios and other risky investments, the portfolios pose huge risk to taxpayers and retirees.
The private sector separates the growth (working years) and income (retiree years) parts of retirement assets. If you want a lifetime income guarantee, you can purchase an annuity product. The portfolios supporting these products invest in relatively high grade corporate bonds. The market for these products is rather small in the US because most individuals do not like the relatively low long-term yields of these investments. Most individuals choose to manage their own portfolio during retirement without an income guarantee. The performance of the portfolio during the first few years is crucial for not outliving the portfolio.
The public DB industry comingles assets to support current workers and retirees. Some of the money is invested rather safely but the majority is invested aggressively. A market decline will hit the assets to support current retirees very hard. When a pension plan indicates that they need an average 8 percent return, they are talking about the entire portfolio to support both current workers and retirees. Realistically, the portfolio to support retirees should earn perhaps 5 to 6 percent on relatively safe investments. A market decline will put the earnings on the retiree part of the portfolio perhaps underwater. More troubling, the retiree part of the portfolio is growing rapidly while the current worker part of the portfolio is growing very slowly if at all (due to worker reductions).
Pension agencies are recklessly managing assets to provide the illusion that the benefits can be obtained without much risk to taxpayers. The private sector cannot manage retirement assets in this manner if required to guarantee income streams at retirement.
Nearly all of those campaigning against new mining and manufacturing operations were employed by local government or global corporations that used local government as a tool against new, domestic competition. So good. The slowdown is working. The socialists won’t be so politically active before long. And if they try more tyrannical moves to squeeze revenues out of the truly productive in wrongful ways, it’ll be much worse for them.