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"For the first time, every retired public employee who is a member of the Wisconsin Retirement System will get a smaller pension check this spring.
Retirement payments will shrink by 2.1 percent, effective May 1, for the 146,000 retirees whose pensions are funded solely by the Core Fund, the primary pension account, the state Department of Employee Trust Funds (ETF) said Friday. The reason: the stock market’s skid in late 2008."
Many pension funds are affected the same way but rather than biting the bullet now are just pushing liabilities into the future. We may see quite a bit more of this in future years.
Gov't pension funds are Ponzi schemes. I expect many of them to fail when push comes to shove. Calpers (giant CA gov't pension fund) has lost big time in the stock market and in real estate investments and is now doing a PR campaign to remind Californians that the pension payouts from the fund are guaranteed by law, in other words that CA taxpayers must foot the shortfall from bad fund manager decisions. The situation is obviously unsustainable.
What do they invest in? I haven't seen a pension fund yet that wasn't doing high-risk investments. They want 10+% returns annually. But then maybe the responsible ones stay under the radar.
I know that Texas Municipal retirement system has never invested in stocks.
They are getting there...
"TMRS will make a gradual transition from its current investment policy, focused on minimizing risk and investment cost while improving the potential for future gains. Half of the 12% equities investment will be dedicated to a portfolio of U.S. companies, and the other half to foreign companies. Each of these equity portfolios will be invested passively to track the performance of a specific index. This is a lower cost approach, and TMRS will be using the Russell 3000 Index for domestic equities, which represents about 98% of the stocks in the U.S., and the MSCI-EAFE for international equities, which is a broad representation of the foreign developed markets. The Board has discussed a five-year transition to an asset mix of 60% equities and 40% fixed income.
In the past, the market value of the portfolio was not a priority for TMRS, since the investment strategy was focused on the income return of the portfolio; however, the transition to equities will emphasize a new focus on a total return investment strategy."
Gov't pension funds are Ponzi schemes. I expect many of them to fail when push comes to shove. Calpers (giant CA gov't pension fund) has lost big time in the stock market and in real estate investments and is now doing a PR campaign to remind Californians that the pension payouts from the fund are guaranteed by law, in other words that CA taxpayers must foot the shortfall from bad fund manager decisions. The situation is obviously unsustainable.
clearly. When the time comes to payout the whole thing will go up in smoke.
"TMRS will make a gradual transition from its current investment policy, focused on minimizing risk and investment cost while improving the potential for future gains. Half of the 12% equities investment will be dedicated to a portfolio of U.S. companies, and the other half to foreign companies. Each of these equity portfolios will be invested passively to track the performance of a specific index. This is a lower cost approach, and TMRS will be using the Russell 3000 Index for domestic equities, which represents about 98% of the stocks in the U.S., and the MSCI-EAFE for international equities, which is a broad representation of the foreign developed markets. The Board has discussed a five-year transition to an asset mix of 60% equities and 40% fixed income.
In the past, the market value of the portfolio was not a priority for TMRS, since the investment strategy was focused on the income return of the portfolio; however, the transition to equities will emphasize a new focus on a total return investment strategy."
But that is pretty old;they didn't make the move from my understanding.Notice that it was a five year plan to start with.Stil very sound and rated in the top five of annuity retirement plans.
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