Pensions In Trouble

[JAMESBJOHNSON]

http://www.bloomberg.com/apps/news?pid=20601109&sid=alwTE0Z5.1EA&refer=home

BE SCARED, BE VERY SCARED.

 

[jomar]

Next they'll scrap the education lottery in favor of the pension mega millions.

I'll play when I'm a greeter at Walmart. If I can afford it.

 

[JAMESBJOHNSON]

JOMAR

I think WAL-MART greeter is now a glamour job.

I expect the local community college to offer a certificate program or AS diploma in greeting soon.

There was a guy on tv this morning using a new name for repo men...something like commercial asset acquisition professional.

 

[DeeZire]

Pensions are for pussies. Did the pioneers have pensions?

With the advancing life expectancy, pensions seem like a bad idea from a business perspective, but that doesn't surprise me. Business is all about the short term - offer a pension package to attract the best workers but don't worry about actually paying the pension until later.

 

[amicus]

Government is short term thinking, confiscate all the money you possibly can, spend it as fast as you can and claim you need more to save the whales.

Business is and always has been long term and by definition, must be, as the return on invested capital, usually in the form of lifetime savings to create a new business.

Rational retirement funds in which the principal is maintained and the returns reinvested to increase the principle, has been, in fact, a known practice since before the pioneers.

Ponzi schemes such as social security and Union pension funds and fraudulent insurance companies could well sour the opportunity to invest to increase funds that will be available when one wishes to retire or can work no longer.

When someone completely illiterate in just how a business functions disregards the initial investment in real property and fixtures, acquiring product, hiring employees and the often twenty hour days by the entrepreneur in the initial debut of a new business, that someone simply has no comprehension of reality.

Amicus...

 

[trysail]

Pensions are for pussies. Did the pioneers have pensions?

With the advancing life expectancy, pensions seem like a bad idea from a business perspective, but that doesn't surprise me. Business is all about the short term - offer a pension package to attract the best workers but don't worry about actually paying the pension until later.

Pensions are, in fact, a recent phenomena. They didn't exist until the '40s and were thereafter taken as a right and assumed to have existed for all eternity.

All of the above was true until the day ( which, if memory serves, was roughly 1982 ) the accounting rules changed to require that pension liabilities ( and their funded status ) be put in the footnotes of the financial statements. Any unfunded liability was required to appear on the balance sheet. As in all accounting, there are lots of assumptions and estimates that are required to perform this task.

Post-retirement health care costs ( and the funding or lack thereof ) were not recognized ( they existed, of course but weren't accounted for ) until 1991.

Competent financial analysts were well aware of these unaccounted-for ( and, in many cases ) unfunded liabilities long before the Financial Accounting Standards Board ( "FASB" ) required that they be explicitly recognized on the balance sheet.

Managements, investment bankers and venture capitalists— with the friendly help of Congress over-ruling the FASB— successfully fended off the recognition of management stock options as an income statement expense for more than a decade. It was only with the moral assistance and prominence of Warren Buffett that the accountants finally embarrassed Congress enough to permit implementation of proper accounting treatment. Until that time, management stock options were a scam of the first order ( they are still "gamed" and abused but not as preposterously and outrageously as they were in the '90s),

 

[DeeZire]

Government is short term thinking, confiscate all the money you possibly can, spend it as fast as you can and claim you need more to save the whales.

Business is and always has been long term and by definition, must be, as the return on invested capital, usually in the form of lifetime savings to create a new business.

Business is all about maximizing shareholder's return for the next quarter. Business is the epitome of short term thinking. Make all the money you can while your market is hot and then disappear.

I don't know where you get your grand platitudes, Ami, but they don't come from the real world.

 

[trysail]

By comparison to the government pension nightmare, the private sector's sins are chickenfeed ( government pension fund accounting standards are notoriously lax by comparison to mandated corporate accounting standards ). If you think corporate pension practices are dodgy, you haven't seen anything until you've seen the completely deceptive thimblerigging that state and local governments and authorities practice— it's one more accident waiting to happen. This is a long and extremely depressing article; be sure you're sitting down and have access to strong drink before you read about the lovely ticking time bomb the politicians have placed in every citizen's wallet:

( This following is a very brief excerpt from )
http://www.bloomberg.com/apps/news?pid=20601109&sid=alwTE0Z5.1EA&refer=exclusive

...Public pension funds across the U.S. are hiding the size of a crisis that’s been looming for years. Retirement plans play accounting games with numbers, giving the illusion that the funds are healthy.

The paper alchemy gives governors and legislators the easy choice to contribute too little or nothing to the funds, year after year.

The misleading numbers posted by retirement fund administrators help mask this reality: Public pensions in the U.S. had total liabilities of $2.9 trillion as of Dec. 16, according to the Center for Retirement Research at Boston College. Their total assets are about 30 percent less than that, at $2 trillion.

With stock market losses this year, public pensions in the U.S. are now underfunded by more than $1 trillion...

 

[manyeyedhydra]

Someone should update Aesop's fables.

The ant worked hard all his life to put away a bit of money for his old age. Then the government/corporation stole it and the ant went into poverty and died of hypothermia.

Having watched my parent's pension become worth less than the money they actually paid into it I won't be handing my money over anytime soon thank you very much.

 

[JAMESBJOHNSON]

DEE ZIRE

Youre describing a government operated healthcare system.

Within any socialist system the government treats citizens as costs to be reduced or eliminated; the citizens treat government healthcare as an unlimited resource to be exploited.

 

[trysail]

The thread title is, of course, absolutely wrong.

It's not the various state, local and municipal pension funds that are in trouble from the chicanery of the pols and their enablers— it's the taxpayers who, sooner or later, are going to get fucked up the ass to pay for government's failure to fund the overpromises they made in the first place. As the article makes clear, the pols have run up a colossal bar bill without telling anybody and it's all on your credit card.

The whole sorry mess is a gigantic fraud; if somebody did this in the private sector, they'd end up doing hard time.

The piper will eventually require payment.



( This following is a very brief excerpt from )
http://www.bloomberg.com/apps/news?p...efer=exclusive

...Public pension funds across the U.S. are hiding the size of a crisis that’s been looming for years. Retirement plans play accounting games with numbers, giving the illusion that the funds are healthy.

The paper alchemy gives governors and legislators the easy choice to contribute too little or nothing to the funds, year after year.

The misleading numbers posted by retirement fund administrators help mask this reality: Public pensions in the U.S. had total liabilities of $2.9 trillion as of Dec. 16, according to the Center for Retirement Research at Boston College.

 

[JAMESBJOHNSON]

TRYSAIL

The title is absolutely correct, unless you have ONE TRILLION stuffed in your jeans to make the bad money good.

You goddamned money guys are quacks like the folks who peddled PERUNA and LYDIA PINKHAMS VEGETABLE TONIC back about 1900.

In fact, I'm making your new name LYDIA PINKHAM.

http://images.google.com/imgres?img...ges?q=LYDIA+PINKHAM&gbv=2&hl=en&safe=off&sa=G

 

[trysail]

The use of a shotgun where a rifle would suffice suggests poor marksmanship.

 

[JAMESBJOHNSON]

LYDIA

I'm in a shotgun sorta mood today.

Ever shoot someone with a shotgun? Man! If you shoot them in their heart the blood comes out like hot syrup from a can...gloop. gloop, gloop