Sundown (and a Friday) before a major Jewish holiday so what better time to stick it to New Jerseyans? Three months ago they floated this scheme and now it looks like a done deal.
30 Sep
New Official Pension-Hole Numbers
The New Jersey State Investment Council held their bimonthly meeting yesterday at which there was a presentation looking to explain how new accounting rules make the system’s funded status look SOOOOOO much worse. The new official GASB 67 numbers:
29 Sep
NJ Pension Asset Data
The New Jersey State Investment Council held their bimonthly meeting today at which June 30, 2016 plan-year-end asset data was released with this lead:
Officials reported the fund lost 0.87 percent in the fiscal year that ended in June, based on unaudited figures.
Not only were the numbers unaudited but the June, 2016 Investment Reporting Package left out much (primarily payouts) that would provide some perspective so, piecing together information from different sources, here is where the New Jersey pension system might stand (in billions):
28 Sep
FE3: Pareto Optimality
Pareto efficiency, or Pareto optimality, is a state of allocation of resources such that no individual can be made better off without making at least one individual worse off. When inefficiency exists, it is possible to improve the well-being of some without injuring others. Transactions that decrease efficiency destroy value, creating deadweight losses, and should be avoided. Institutions maximize value by exploiting profitable opportunities and by minimizing deadweight costs. Just as in mechanics, friction is the enemy of efficiency. Financial frictions may be created by things such a s transaction costs, taxes, lack of transparency, actuarial smoothing, regulatory barriers and costly bankruptcy.
First I ever heard of Pareto optimality and it took a while to sink in (after I figured out that there should be a ‘not’ in the second sentence) but then today I came across the term a second time in a context that seems to make it moot for inclusion in an argument for financial economics principles being applied to public pension plans.
24 Sep
Who’s Stealing From Whom Within NJ Pension?
Millenial Moola thinks it’s teachers from the police but the reality is a lot more complicated – and it may even be the other way around.
20 Sep
Breaking News: Ninth Union Plan Files
On August 30, 2016 trustees of the New York State Teamsters Conference Pension and Retirement Fund out of Syracuse, NY became the ninth multiemployer (union) plan to file for benefit cuts under MPRA in an attempt to avoid insolvency and this one has a twist (all retirees @ 12/31/15).
From their latest 5500 form here is the plan’s relevant data:
19 Sep
Half-Truth on New Jersey Fiscal State
Truth in Accounting released a report today on the Financial State of the States based on data provided by the states.
New Jersey came in last based on the numbers but we have two, if not entirely unique at least exaggerated, burdens to bear here that put us in a much worse fiscal position:
