Daily Digest

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Daily Digest 5/17 - Playing Catch-Up On Pension Funding, Italy Inflation and Debt Rise

Wednesday, May 17, 2017, 8:32 AM


Vermont Health Insurer Asks to Increase Rates 12.7 Percent

Blue Cross and Blue Shield of Vermont says about half of the increase is due to a federal tax mandated by the Affordable Care Act that was not in place last year, the shift of costs from Medicare and Medicaid and because Vermonters are getting older.

Fairfield pension costs projected to reach $37.5M yearly

The city’s pensions costs will increase by 14 percent in fiscal year 2018-19 and continue to climb yearly for the next decade until the city’s yearly cost is projected to be $37.5 million, says a study Fairfield City Council members take up Tuesday.

Playing catch-up on public pension funding (California)

According to a recent update from the state’s nonpartisan Legislative Analysts’ Office, from fiscal year 2016-17 to 2020-21, annual contributions to CalSTRS from school districts, the state and teachers will rise from $9.7 billion to $14.3 billion.
For context, in 2013-14, districts were contributing just under $2.1 billion and the state $1.36 billion to CalSTRS.

Forget Puerto Rico, What About U.S. States' Soaring Pension Debts?

Looked at in the long term, the numbers are even more frightening. The 2017 report says that unfunded pension liabilities — that is, money owed to retirees without investments to back them up — now stand at $3.85 trillion, $434 billion more than a year ago.

Gov. Malloy Revises Budget To Plug $2.5 Billion Deficit (Connecticut)

Malloy says his new plan will cover a predicted $2.3 billion deficit in the fiscal year beginning July 1. That's a $600 million increase from the earlier projection.
The governor revised the two-year $40.6 billion budget he released in February after anticipated income tax revenues dropped sharply.

Italy Inflation, Debt Rise

Meanwhile, Italy’s public debt hit a new high of €2.2603 trillion ($2.48 trillion) in March, an increase of €20.1 billion with respect to February, the Bank of Italy said on Monday. The previous high was the 2.2522 trillion registered in June 2016, ANSA reported.
Late April, Italy’s credit rating was cut closer to junk territory by analysts at Fitch, who cited “weak economic growth” and the country’s “persistent track record of fiscal slippage”.

Italian economy to shrink slightly this year: S&P

"Due to its high public-sector debt and low growth momentum, Italy is particularly sensitive to an interest rate shock," the agency added.
Italy's government debt equaled 132.6 percent of the country's economic output last year, according to Italian official statistics bureau, Istat.

Gold & Silver

Click to read the PM Daily Market Commentary: 5/16/17

Provided daily by the Peak Prosperity Gold & Silver Group

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Puerto Rico's bankruptcy hearing marks reset of asset scramble

Stress in Japanese corporate bonds seen as a sign of things to come

Reuters-6 hours ago

That's a sizeable move in yields in an economy where short-term policy rates are negative and where the central bank massively buys up securities, including ..

Spain's public debt rises by 11 billion euros in March from February

Times of India-5 hours ago
MADRID: Spain's public debt rose by 11.16 billion euros ($12.37 billion)to 1.13 trillion euros in March, the Bank of Spain said on Wednesday, the fourth straight ...

Puerto Rico's bankruptcy hearing marks reset of asset scramble

Reuters - ‎17 hours ago‎
Whether they get that level of recovery is debatable, according to investors and analysts, as the U.S. territory seeks to restructure more than $70 billion in debt, from multiple agencies, and another near $45 billion in underfunded pension liabilities.

NJ facing close to $700 million budget shortfall

Burlington County Times-21 hours ago
The current year's deficit will have to be closed — likely with spending ... school districts than what Christie's proposed $35.5 billion state budget allotted.

Grand jury focuses on pension and audit issues

Redding Record Searchlight-12 hours ago
In its report, the grand jury says unfunded pension liabilities has become a ... city of Redding with having about $207 million in unfunded liabilities, while Shasta ...

Illinois lawmakers attempt to bail out Chicago Public Schools yet again

Illinois Policy-17 hours ago
Their excuse for the bailout is simple: The state pays the pension costs of every school district in Illinois except CPS. But that argument is wrong. It ignores the ...

Shaken By Protests, Venezuela Sees Casualties Mount As ...

NPR-17 hours ago

More than six weeks into ever-deepening demonstrations against President Nicolas Maduro's government, Venezuelans have found themselves staring down ..

Milliman: Typical American Family Faces $26K In Health Care Costs

Insurance News Net-17 hours ago
This year's MMI includes analysis of dynamics driving healthcare costs, including the sometimes elusive nature of rebates in drug pricing. While rebates often do ...


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Household debt tops 2008 peak ahead of financial crisis

Household debt tops 2008 peak ahead of financial crisis

USA TODAY - ‎21 hours ago‎
In the mid-2000s, lenders too easily doled out all types of loans, but particularly mortgages, fueling housing and credit bubbles that ultimately collapsed. Households shed more than $1.5 trillion in debt, most of it housing-related and partly through ...

Auto loans hit $1.1 trillion

KSDK-19 hours ago
Total securitized auto loans have topped $1.1 trillion, an increase of some 60% ... have the greatest effect in shrinking a potential debt bubble before it can burst.

Fed's Kashkari says central bank should avoid fighting asset-price bubbles

MarketWatch - ‎19 hours ago‎
The Fed does have tools like its supervision authority over banks, which in 2013 the central bank used to rein in leveraged loans. But Kashkari said, unlike other countries, the Fed cannot adjust the loan-to-value requirements of mortgages. And the ...

Report shows 'true' accounting of pension liabilities more than double what governments say; Expert: debt is ...

Sangamon Sun - ‎12 hours ago‎
"These calculations reflect the fact that accrued pension promises are a form of government debt with strong rights," Rauh wrote. "These unfunded liabilities represent an increase of $434 billion over 2014, as realized asset returns fell far short of ...

Portugal's lower negative yields for debt auction is turning point in ...

Xinhua-15 hours ago
LISBON, May 17 (Xinhua) -- Portuguese President Marcelo Rebelo de Sousa said on Wednesday that Portugal's 1.5 billion euros (1.67 billion U.S. dollars) in ...

Illinois bill backlog balloons to $14.3 billion

Reboot Illinois-20 hours ago
The comptroller's office says the amount of debt held at state agencies now accounts for close to half — $6.6 billion — of the total backlog, and “is nearing the ...

Venezuela's oil production on the brink of collapse

RT - ‎3 hours ago‎
PDVSA and the national government avoided a debt default a few weeks ago, but with obligations looming later this year and a dwindling pile of cash with which to draw upon, the problem is not going away. As far as the oil sector goes, the best case ...

Fuel shortage again hits oil-rich Venezuela amid refinery woes, protests

Reuters - ‎18 hours ago‎
Venezuela, which has the world's cheapest gasoline, has been plagued by intermittent fuel shortages in recent months as its oil industry struggles with lower production. Lines were reported in the southeastern Anzoategui and Bolivar states as well as ...

Thousands of Troops Have Been Deployed to Quell Political Violence in Venezuela

TIME - ‎10 hours ago‎
(SAN CRISTOBAL, Venezuela) — Legions of national guardsmen and military helicopters began descending on a western Venezuela state Wednesday where an outbreak of looting and political violence left at least three people dead in as many days, raising ...


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