"Distressed companies might have to turn their pension plans over to the government"
You must have a DEEP ANAL CANAL, 'murkns!!!
What's that? I can't hear you scream with your face buried in that bowl of shit!!!
"Down market squeezes pensions; Some employers drop their plans; Others forced to pump in cash" by Todd Wallack, Globe Staff | October 26, 2008
US corporate pension funds are getting slammed by the stock market's downturn, squeezing profits and prompting some employers to drop their pension plans or make other cuts to offset losses.
I never believed their false promises.
Just last week, defense giant Lockheed Martin Corp. cut its earnings forecast, citing higher pension costs; its retirement investments had dropped 25 percent this year. Boeing Co. estimated its pension fund was down 20 percent this year, likely forcing it to pump in $100 million more. And Raytheon Co., based in Waltham, said it plans to boost contributions to its pension fund by an extra $94 million next year, partly because its pension fund has shrunk 20 percent since January.
"We're going to have a very bad year," said Howard Silverblatt, an analyst with Standard & Poor's, a financial research firm based in New York. "Companies are going to have to put significant amounts of money in [pension funds] this year."
Silverblatt estimated that S&P 500 companies started the year with $63 billion more in pension assets than they needed to meet future payments. But after this year's market debacle, Silverblatt said, they will probably end the year in worse shape than in 2002, when pensions were underfunded by $219 billion.
Another research firm, Milliman Inc. predicted the 100 largest pension plans sponsored by public companies in the United States would end the year with a $40 billion deficit, even if stocks are flat during the fourth quarter. That compares with the $101 billion surplus the plans enjoyed in 2007.
To stem the losses, some companies have decided to drop or scale back their traditional pension plans, which guarantee workers a fixed retirement income, in favor of 401(k) plans, where employees manage their own investments and face the risk of market downturns.
Don't ever tell me how much of a "family" we are ever again, corporate!!
Companies aren't allowed to revoke pensions that employees and retirees have already earned, but can "freeze" or halt the accrual of additional benefits.
For instance, Equifax Inc., the Atlanta-based credit agency, said last month that it will freeze its US pension plan, affecting 4,000 employees. And The New York Times Co., which owns The Boston Globe, last week decided to scale back pension benefits for nonunion employees. Both companies vowed to beef up workers' 401(k) benefits.
Oh, LOOK at this!! The "LIBERAL, PRO-LABOR" New York Times and Boston Globe STICKING it to their NON-UNION EMPLOYEES!!
What a band of SHIT-STINKING FUCKING HYPOCRITES!!!
Oh, FUCK YOUR SHIT SHEETS, you piles of soft-serve swirlies!!!!!!!!!
Many other companies have already shed their pension plans to save money and avoid the risk of stock market swings, but some people who track pensions said the trend could accelerate because of the stock market's precipitous drop.
Karen Friedman, policy director for the Pension Rights Center, urged Congress to step in immediately to help preserve employees' pensions, just as it rushed to pass a $700 billion plan to bail out financial institutions.
Yeah, right!!
Specifically, Friedman said Congress could give companies more time to fully fund their pensions and it could also consider changing pension rules to allow companies to offer different plans that might be easier to fund. In the meantime, many companies are stepping up funding of their pension plans to offset investment losses.
Raytheon, for instance, plans to contribute $612 million next year to its pension fund, up from $518 million this year, partly because of the dive in the stock market. But the defense contractor said its fund is still on track to being fully funded by 2018. "Raytheon is fully committed on every level to meeting any and all obligations of the pension plan in the foreseeable future," said David C. Wajsgras, chief financial officer.
Some other companies with Massachusetts operations have pension funds that were significantly underfunded by the end of 2007, a situation probably made worse by the market decline this year. Among them are Boston Scientific Corp., Genzyme Corp., Intel Corp., Millipore Corp., and Interpublic Group of Companies Inc. according to data collected by Standard & Poor's. But some of the firms said their retirement plans cover so few workers that they don't expect any problems covering the losses.
Except when the JOB CUTS come!!!
Millipore, with headquarters in Billerica, said the company pitched in an extra $10 million this year to help shore up its small pension plan. But Joshua Young, director of Millipore's investor relations, noted: "That's a relatively small amount for us. We'll have $150 million in cash flow this year."
Government pension plans have been affected by the market downturn as well. The California Public Employees' Retirement System, the largest pension system in the United States, said it might have to require the agencies and schools that participate in the plan to increase payments after watching its investment fund shrink by 20 percent, or $50 billion, this year.
Meanwhile, the Massachusetts pension fund will decide whether to increase contributions next spring. Through the first nine months of the year, the fund's value dropped by nearly 16 percent to $45 billion and has almost certainly fallen farther this month, said Michael Travaglini, executive director of the Pension Reserves Investment Management Board, which manages the fund.
That's Michael Travaglini, the executive director, carving himself a nice "$64,000 bonus on top of his $322,000 annual salary" -- while the state pension fund loses billions!!!
The situation is more perilous for companies already struggling to maintain profits in the face of a weakening economy.
That is the IMPORTANT THING -- not the PROMISES they made!
In some extreme cases, distressed companies might have to turn their pension plans over to the government. Just last week, Pension Benefit Guaranty Corp., the federal agency charged with backing up pension benefits for 44 million Americans, rescued an underfunded pension plan from Pope & Talbot Inc., a bankrupt lumber company in Oregon.
"The bottom line is that companies are going to have to make cash infusions" into pension plans, said Silverblatt, the S&P analyst. "It's going to hurt profits and cash flow." --more--"
Unless the TAXPAYERS TAKE OVER!!
BEND OVER, 'murka!
