Secure Ohio Pensions?

In trumpeting his record in Ohio John Kasich mentioned:
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Last year the Mercatus Center ranked states by fiscal condition.  Ohio came in at 7.  By comparison New Jersey was 49.

But are Ohio public pensions really secure?
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NFL Pension A Headache?

Pensions & Investments sees the funded status of the National Football League (NFL) Players retirement plan as not a worry while the Wall Street Journal sees it is a worry.

So who do you believe?

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Arrogance of the Conveniently Innumerate

This morning John Stossel had an interesting piece centering on New Jersey Governor Chris Christie bailing out Atlantic City after promising to “reform” and “rebuild” the city “without government money.” Stossel portrayed Christie as another traitorous politician though I suspect that when Christie made that ‘promise’ he believed it – even if it was primarily because he believed his advisers and he was too dumb (or conveniently disinclined) to understand the real situation.

So it is with another piece that came out this morning by New Jersey Senate president Stephen Sweeney again pimping for an otiose constitutional amendment on public pensions with the same series of fallacious arguments debunked here previously though he added one wrinkle:

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Speaking of Bubble Boy

Donald Trump mentioned carried interest and Chris Christie had a plan, however inane and/or illegal, to cut Social Security benefits.  Outside of that it has been all posturing as nothing approaching a relevant issue (to me anyway) has surfaced in the last six months of the presidential race as these candidates seem to be operating within a bubble. Speaking of which…

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Connecticut’s Fund-Split Scam

A Wall Street Journal story linked  General Electric Co.’s planned move to Boston to worries over Connecticut’s woeful funded ratio for its public pension system.

So Connecticut has a plan and it would not change what union members would receive when they retire nor would it add or cut pension benefits.  All it would do is raise the funded ratio just like Pension Obligation Bonds (POBs) have been doing.

Here is how it would work…..

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Made Off With NJ Pension Money

The New Jersey State Investment Council held a public meeting yesterday and three news sources covered it – all a little differently.

NorthJersey.com: Investment gains for New Jersey’s $79 billion pension fund fell sharply in the fiscal year that ended June 30, and those pension investments are in negative territory so far this year, state officials reported Wednesday…..Venture capital, real estate and equity investments performed the best. But the state’s investments in commodities tumbled 20.85 percent largely due to crude oil prices falling by half in recent months, and bets on emerging and developing economies around the world turned out to be losers.

nj.com: The pension fund supports the retirement of nearly 800,000 active and retired public employees in New Jersey. It pays out roughly $700 million a month in benefits. Its market value over the past year decreased dramatically from $79 billion at the end of June to slightly more than $71 billion at the end of December.  About $27 billion of the fund’s assets were invested in alternatives including global diversified credit, hedge funds, private equity, real estate, and real assets as of June 30. For the fiscal year that ended June 30 and the calendar year that ended Dec. 31, the best performing asset classes were those that are part of the state’s controversial alternative investment program…..For the calendar year, alternatives had a one-year annualized return of 5.6 percent, compared with .63 percent for the total fund and –1.88 percent for traditional investments. Over five years, alternatives’ annualized returns were 9.22 percent, higher than all other investments’ 6.56 percent. “The alternative investments program (net all fees) has outperformed the broader pension fund and a mix of broader global public markets… on an absolute and risk-adjusted basis,” the division said. A consultant, Aon Hewitt Investment Consulting, also reported favorably on the fund’s alternative investments, saying the division’s “alternative investment program has achieved higher returns with less risk” and “may be viewed favorably from a cost-benefit perspective.”

njspotlight: Still, pension-system officials yesterday defended their overall alternative-investment strategy, pointing to the numbers compiled by Aon Hewitt that showed the investments have produced 9.2 percent net returns over the last five years. That beats the pension system’s assumed rate of return of 7.9 percent, and the overall 7.3 percent rate of return the system experienced during the same five-year period.

The takeaway:

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The Book on Christie

The one thing more frustrating then living through a governorship dominated by ill-thought-out schemes foisted on an apathetic electorate by a clueless blowhard is reading about it.  So it is with American Governor, a new book by Matt Katz who has been stalking Chris Christie and reporting on it for pay.

I read the ‘Union Wars’ chapter (and skimmed a few others) and found only a rehash of things I already knew both literally (95% of the book seems shallow enough to have appeared in a newspaper first) and deductively (Christie is an asshole who would have never risen to the governorship if there were skills beyond fundraising necessary to be appointed a US Attorney and New Jersey were not the pay-to-play capital of the universe).

For the record, my few notable excerpts:

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