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Daily Digest 12/7 - TX Towns Facing Massive Pension Shortfalls, ECB Haunted By Stimulus Choice

Wednesday, December 7, 2016, 8:51 AM


Increased pension costs add to Missouri budget issues

The cost of funding Missouri’s state employee pensions will increase nearly $50 million in the next fiscal year as investment losses and lower earnings expectations push taxpayer contributions to the highest share of state payroll in the program’s history.

Austin, Dallas, Houston and San Antonio facing massive pension shortfalls

According to a new report from credit rating and financial analysis firm Moody’s, the Lone Star state’s four largest cities - Austin, Dallas, Houston and San Antonio - collectively face $22.6 billion worth of pension fund shortfalls. Here’s the story so far:

Dallas Mayor Mike Rawlings Files Private Lawsuit To Stop Pension Withdrawals

More than $500 million in deferred retirement funds have been withdrawn since August, worsening the fund's finances. A study commissioned by the pension board projected that the fund will be insolvent in less than 15 years if no changes are made to the benefits received by members or to the amount of money the city contributes.

Japan govt to issue additional deficit-covering bonds around $17 billion for FY2016 -govt sources

Japan is considering issuing additional deficit-covering bonds worth around 1.9 trillion yen ($17 billion) to offset an expected tax revenue shortfall in the current fiscal year to March, government sources told Reuters on Tuesday.

Brazil's Temer unveils pension reform, sets retirement age at 65

The plan, aimed at restoring fiscal discipline to in an effort to regain investors' confidence, would set a minimum age of retirement at 65 years in a country where people work on average until the age of 54 years before retiring.

New Illinois comptroller faces red ink, asks 'Please bear with me'

Democrat Susana Mendoza was sworn in Monday as state comptroller during a small ceremony at the Capitol, asking for patience and prayers as she takes office with lllinois' pile of unpaid bills topping $10.4 billion.

Rout shrinks universe of negative yielding bonds by $2.5tn

The share of corporate bonds trading with yields at less than zero has posted a shallower fall. Roughly 24 per cent of euro-denominated bonds with an investment grade rating had a negative yield as of December 1, from 28.6 per cent in August.

ECB Haunted by Ghost of Christmas Past as Stimulus Choice Nears

The ECB has already spent 1.4 trillion euros on quantitative easing, a figure that will rise to 1.7 trillion euros by the end of March. A crucial hurdle to enlarging it even further is that some assets simply aren’t eligible to buy under self-imposed rules.

Gold & Silver

Click to read the PM Daily Market Commentary: 12/6/16

Provided daily by the Peak Prosperity Gold & Silver Group

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More Canadians going bust as consumer debt surges 3.6%



The Persian Gulf's debt binge creates a 'vicious circle' on the Arab ...

CNBC-19 hours ago
In Qatar, billions of dollars in recently raised sovereign debt will help to accommodate soccer fans when FIFA comes to town. In Bahrain, bond proceeds are ...

More Canadians going bust as consumer debt surges 3.6%

The Globe and Mail - ‎4 hours ago‎
The credit reporting agency found that average debt increased by 3.6 per cent to $22,081 in the quarter ended Sept. 30 compared to the same period last year. As of the third quarter, Canadian consumers owed $1.702-trillion compared to $1.587-trillion a ...

Canadians' average debt load now up to $22081, 3.6% rise since last year

CBC.ca - ‎1 hour ago‎
In a report released Wednesday, Equifax says the debt figure increased by 3.6 per cent in the third quarter of 2016 compared to the same period a year ago. All in all, consumer debt now stands at more than $1.7 trillion. But while the average is rising ...

China's Big Savers Are Racking Up More Debt

Bloomberg-13 hours ago

... one else in the world, are racking up more debt as borrowing options proliferate. ... Deposits stand at 59.6 trillion yuan ($8.67 trillion), People's Bank of China ..

Exclusive: Italy preparing to take controlling stake in Monte dei ...

Reuters-20 hours ago
Monte dei Paschi must raise 5 billion euros ($5.4 billion) by the end of this month to ... The bank is set to raise 1 billion euros from a bond swap with institutional ...

Junk-rated Chicago schools plan new kind of bond issue

Yahoo News-15 hours ago
The preliminary prospectus for the debt indicates the Chicago Board of ... That pledge currently covers about $6.8 billion of existing bonds that are rated junk by ...


Uncletommy's picture
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Posts: 637
Back to fundamentals!

ECB Haunted by Ghost of Christmas Past as Stimulus Choice Nears

"How long can you tread water" has been referred to in a recent post and may be quite applicable in the world's current monetary state. Given that Mexico just passed Canada in the value of its exports to the US, I wonder how effective Mr. Trump's protectionist policies will fare for US workers.  

"By definition, monetary deflation can only be caused by a decrease in the supply of money or financial instruments redeemable in money. In modern times, the money supply is most influenced by central banks, such as the Federal Reserve. Periods of deflation most commonly occur after long periods of artificial monetary expansion." (Investopedia)

Despite Mr. Trump's enthusiasm in turning the US economy around, perhaps it is a bit "over-hyped". Productivity of the world's economies seems somewhat anemic, currently, and any further monetary stimulus is questionable, IMHO. Hopefully, the world's top 0.7% don't start stuffing their cash into their mattresses!

"There are two principle causes of price deflation. The first is a general increase in the demand for cash savings by consumers and businesses. This could be because consumers are uncertain, or because their time preferences for consumption have lengthened." (Investopedia)

More Canadians Going Bust As Consumer Debt Surges 3.6%


Doug's picture
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disastrous appointment

Scott Pruitt, long time flak for the oil industry is being nominated as head of the EPA. As I heard someone say the other day, I probably won't live long enough to see the damage done by Trump undone.

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rjs's picture
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Posts: 445
the damage done by Trump...
Doug wrote:

Scott Pruitt, long time flak for the oil industry is being nominated as head of the EPA. As I heard someone say the other day, I probably won't live long enough to see the damage done by Trump undone.

you figure he's gonna burn a lot of oil and pollute the whole country by himself?  truth is, he can't do much damage by himself unless the rest of us co-operate...no one is gonna hold a gun to our heads and make us fill up at Exxon..

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