Sacramento, for example, has $908 million in unfunded pension liabilities. Its public safety pension plan has 68.4 percent of the assets it would need to pay the benefits it owes, according to CalPERS.
Illinois has more than $130 billion in unfunded pension debt for its five state-run pension systems. Adding in other post employment benefits, that number climbs to more than $200 billion. Municipal governments in Illinois also are struggling with unfunded pension liability. Some report using most, if not all, of their share of property taxes to pay pension costs.
The defaults triggered sharp falls in Indian stock and debt markets amid fears about risk in the rest of the country’s financial sector. The Indian government took control of the company and replaced its board with six nominees.
Italy’s debt costs rose to their highest level in more than four years at auction on Tuesday, piling pressure on the Rome government after data showed the euro zone’s third-largest economy stopped growing in the third quarter.
Australia’s predicament is made worse by the need to cut debt occurring during a period of falling house prices and at a time when the household savings rate is a wafer-thin 1 per cent of disposable income.
The U.S. Treasury Department said government borrowing this year will more than double from 2017 to $1.34 trillion as the Trump administration finances a rising budget deficit.
“Today’s budget confirms our expectation that we won’t see a material reversal in the UK’s high public debt levels for some time and that elevated debt levels will continue to be a credit challenge for the UK for the foreseeable future,” Sarah Carlson, Moody’s lead sovereign analyst for the UK, said in a statement.
The Third Way study more starkly assesses the jobs in each metro area and the opportunities they’re providing to live a good life. By those measures, the study found that Trenton, New Jersey, and Durham, North Carolina, rank highest among the nation’s 204 largest metro areas in share of middle-class or better jobs. Honolulu and Myrtle Beach, South Carolina, on the other hand, are near the bottom.
Debt Alarm Ringing (thc0655)
As noted, debt can be appropriate—even government debt, in some (rare) circumstances. I am glad FDR issued war bonds to help defeat the Nazis, for instance. Now, however, governments go into debt not because they face existential threats, but simply to keep their citizens and benefactors comfortable.
Similarly, central banks enable debt because they think it will generate economic growth. Sometimes it does, too. The problem is they create debt with little regard for how it will be used. That’s how we get artificial booms and subsequent busts.
The Treasury is boosting sales of bills, notes and bonds in part to help finance a budget gap that’s widening after President Donald Trump signed $1.5 trillion in tax cuts late last year and the Republican-controlled Congress approved a roughly $300 billion spending increase. Meanwhile, the Federal Reserve is shrinking its balance sheet and choosing not to replace its holdings of some Treasuries as they mature, and an aging population is boosting costs of federal programs such as Medicare.
Gold & Silver
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