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Labor Day Chart of the Day
Pension Storm Getting Worse


The above chart comes to us via a report from the Nelson A. Rockefeller Institute of Goverment (h/t Bloomberg). It shows how unfunded pension liabilities, currently measured at $1.8 trillion, have trended as a percent of state and local government tax revenues.

An irresistible force is approaching an immovable object…

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  • Kevin

    With the huge run up in the S&P 500 over the last year, pensions should be in a LOT better shape now.

    • rpabate

      Maybe this is what happens when you have “politically correct” investment guidelines.

      • Kevin

        S&P 500 is up 13.3% over the last year. Any public pension fund manager who has <10% ought to be shot.

  • OregonJon

    This reality has been clear to “blind freddy” for decades. The actuaries that advice both public and private pensions may play by the “rules”, but they know the rules are designed to avoid reality. Yet as Herb Stein said when the chairman of the president’s Council of Economic Advisers, “if something can’t go on forever, it will stop.” How it will stop is unknown, but stop it will. We need more (some?) politicians to raise the alarm, but that is a fantasy statement. Should we mention that the birthrate trend line is bending downward. Soon there will more workers retiring than are entering the workforce. Then it really gets ugly.

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