Daily Digest

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Daily Digest 12/14 - Bitcoin Hits 34-Mo. High, Pension Problems Much Worse Than Forecasted

Wednesday, December 14, 2016, 10:12 AM

Economy

Shocker! DWP’s Pension Plan is $4.8 Billion Underfunded … Ratepayers Will Pay the Bill! (Los Angeles)

When DWP finishes cooking the books and marks the assets to their true market value and assumes a more realistic investment rate assumption of 6.25%, the unfunded liability soars to $4.8 billion, representing an unhealthy funded ratio of 71%.

Growing pension cost contributing to projected $12.2 million budget shortfall in Santa Barbara County

Santa Barbara County is facing a projected $12.2 million budget shortfall for the coming fiscal year, which is expected to grow to more than $45 million over the next five years.

KPERS: $177 million in extra funding needed next year to keep system on track (Kansas)

Kansas also issued a $1 billion pension bond in 2015 after the Legislature authorized the debt. Rep. John Alcala, D-Topeka, has also served on the pensions committee. He said the state shouldn’t have issued the bonds, but more immediately, he expressed fear over future pension payments into the trust fund. “I have concerns we’re not going to be able to make the payments,” Alcala said.

Pension problems much worse than initially forecasted (South Carolina)

He says the state is somewhere between $20 and $40 billion short on pensions. Early reports had the debt at $21 billion. Richard Eckstrom, South Carolina’s Comptroller General, says it’s likely a debt between $30 and $35 billion. The state’s total budget is $8 billion annually, he added.

Venezuelan debt to airlines in Latin America: 3.8 billion dollars

“The refusal of the Venezuelan foreign exchange authority CADIVI to pay the tickets sold in the Venezuelan currency Bolivars in dollars to the airlines is contrary to international obligations,” says the IATA representative.

FACTBOX-Emerging market debt default risks in 2017

Emerging governments and companies must repay more than $300 billion next year in hard currency debt, roughly a third more than 2016 - the result of a borrowing spree after 2008 when Western interest rates collapsed.

Student loan debt on the rise, apprenticeship programs offer alternative

According to StudentLoanHero.com, Americans owe almost $1.3 trillion in student loan debt. The average Class of 2016 graduate owes over $37,000 in student loan debt, a statistic that has risen six percent from 2015. Now, many are turning to alternative options to pursue their dream career. After graduating high school, Rick Decker realized attending college was not the best option.

Bitcoin hits a 34-month high amid Chinese stock market volatility, yuan falls

People are waking up to the fact that bitcoin is money in the cloud, so when you exchange from local currency like the Chinese yuan or U.S. dollar, you are exchanging this physical money to money in the cloud. What's good about money in the cloud, is it has been stable, the volatility has been down, it's a good store of value," Lee told CNBC by phone.

Gold & Silver

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

Provided daily by the Peak Prosperity Gold & Silver Group

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1 Comment

TechGuy's picture
TechGuy
Status: Gold Member (Offline)
Joined: Oct 13 2008
Posts: 366
Re: Pensons

FWIW: All Pension (public or private) are insolvent:

1. Lost Trillions in the Stock Market bubbles (1987, 2000, 2007)

2. Never properly funded them from the start (partially because the manager though the stock market was going to the moon and they didn't need to make contributions)

3. Companies & Gov'ts borrowed money from Pensions for projects, stock buybacks, etc

4. ZIRP for the past 8 years made zero returns on bond investments.

 

If you have a pension plan you best option is to cash it out if you can so you don't get screwed when its your time to widthdraw and you only get a penny or less on the dollar. If you have started saving for retirement, (betting the farm on a sound pension), you better think twice, and start saving or alternative investments available to you. 

 

 

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