Throughout my whole life, I never believed the lying looters' promises. I'm never going to see a pension, Social Security, or retirement -- nor are the millions of young people behind me.
They have LOOTED the NATION, people, and it is time to WAKE UP and SMELL the S*** PILE!!!!
Related: Corporate Pension Funds Next in Line for Bailout Loot
"Pension insurer shifted to stocks; Concern increases as losses mount; Failing plans could overwhelm agency" by Michael Kranish, Globe Staff | March 30, 2009
WASHINGTON - Just months before the start of last year's stock market collapse, the federal agency that insures the retirement funds of 44 million Americans departed from its conservative investment strategy and decided to put much of its $64 billion insurance fund into stocks.
That can't have been good.
Switching from a heavy reliance on bonds, the Pension Benefit
No statistics on the fund's subsequent performance were released. Nonetheless, analysts expressed concern that large portions of the trust fund might have been lost at a time when many private pension plans are suffering major losses. The guarantee fund would be the only way to cover the plans if their companies go into bankruptcy.
"The truth is, this could be huge," said Zvi Bodie, a Boston University finance professor who in 2002 advised the agency to rely almost entirely on bonds. "This has the potential to be another several hundred billion dollars. If the auto companies go under, they have huge unfunded liabilities" in pension plans that would be passed on to the agency.
Translation: you are fucked, America. It's over. There is no money left.
In addition, Peter Orszag, head of the White House Office of Management and Budget, has "serious concerns" about the agency, according to an Obama administration spokesman.
Last year, as director of the Congressional Budget Office, Orszag expressed alarm that the agency was "investing a greater share of its assets in risky securities," which he said would make it "more likely to experience a decline in the value of its portfolio during an economic downturn the point at which it is most likely to have to assume responsibility for a larger number of underfunded pension plans."
Little late now, isn't it?
However, Charles E.F. Millard, the former agency director who implemented the strategy until the Bush administration departed on Jan. 20, dismissed such concerns. Millard, a former managing director of Lehman Brothers, said flatly that "the new investment policy is not riskier than the old one."
Ah, yes, the revolving door of Wall Street and Washington.
He said the previous strategy of relying mostly on bonds would never garner enough money to eliminate the agency's deficit. "The prior policy virtually guaranteed that some day a multibillion-dollar bailout would be required from Congress," Millard said.
But you had to go and make it worse just before you left town, huh?
He said he believed the new policy - which includes such potentially higher-growth investments as foreign stocks and private real estate - would lessen, but not eliminate, the possibility that a bailout is needed.
So that it NOW will cost TRILLIONS MORE? WTF is this double-talking nonsense from these lying looters?
Asked whether the strategy was a mistake, given the subsequent declines in stocks and real estate, Millard said, "Ask me in 20 years. The question is whether policymakers will have the fortitude to stick with it."
(Blog editor is beside himself right now; we NEED THAT MONEY NOW!!!!)
But Bodie, the BU professor who advised the agency, questioned why a government entity that is supposed to be insuring pension funds should be investing in stocks and real estate at all. Bodie once likened the agency's strategy to a company that insures against hurricane damage and then invests the premiums in beachfront property.
Yeah, good question.
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Since he issued that warning, he said, the agency has gone even more aggressively into stocks, which he called "totally crazy."
It's a.k.a. THROWING YOUR PENSION MONEY AWAY to WALL STREET!!!
The agency's action has also been questioned by the Government Accountability Office, the investigative arm of Congress, which concluded that the strategy "will likely carry more risk" than projected by the agency. "We felt they weren't acknowledging the increased risk," said Barbara D. Bovbjerg, the GAO's director of Education, Workforce and Income Security Issues.
Analysts also believe the strategy would not have been approved if the government had foreseen the precipitous decline in the stock market. Now, they warn about a "perfect storm" scenario in which the agency's fund plummets in value just as more companies go into bankruptcy and pass their pension responsibilities onto the insurance fund. Many analysts say it is inevitable that the agency will face significantly increased liabilities in coming months.
Yeah, ALL those CORPORATIONS are going to fob of their retirement costs on YOU, American taxpayers!!! I'm wondering how many more burdens those assless, narrow shoulders can bear.
"The worst case scenario is coming to pass," said Mark Ruloff, a fellow at the Pension Finance Institute, an independent group that monitors pensions. He said the agency leaders "fail to realize that they are an insurer of pension plans and therefore should be investing differently than the risk their participants are taking."
The Pension Benefit Guaranty Corporation may be little-known to most Americans, but it serves as a lifeline for the 1.3 million people who receive retirement checks from it, and the 44 million others whose plans are backed by the agency.
The agency was set up in 1974 out of concern that workers who had pensions at financially troubled or bankrupt companies would lose their retirement funds. The agency operates by assessing premiums on the private pension plans that they insure. It insures up to $54,000 annually for individuals who retire at 65.
Despite its name, the agency does not necessarily guarantee the full value of a person's pension and is not backed by the full faith and credit of the government.
Faith and credit of whom?
How can a government give something it doesn't have?
You'll never see that promised money, American.
Nonetheless, agency officials say that if the pension agency fails to meet its obligation, the government would come under intense political pressure to step in. That means taxpayers - including those who don't get pensions - could be asked to pay for a bailout.
Currently, the agency owes more in pension obligations than it has in funds, with an $11 billion shortfall as of last Sept. 30. Moreover, the agency might soon be responsible for many more pension plans. Most of the nation's private pension plans suffered major losses in 2008 and, all together, are underfunded by as much as $500 billion, according to Bodie and other analysts. A wave of bankruptcies could mean that the agency would be left to cover more pensions than it could afford.
In the early years of the George W. Bush presidency, the agency took a conservative investment approach under director Bradley N. Belt, who favored putting only between 15 and 25 percent of the fund into stocks. Belt said in an interview that he operated under "a more prudent risk management" style and said he "would have maintained the investment strategy we had in place." Belt left in 2006 and Millard arrived in 2007.
Under Millard's strategy, the pension agency was directed to invest 55 percent of its funds in stocks and real estate. That included 20 percent in US stocks, 19 percent in foreign stocks, 6 percent in what the agency's records term "emerging market" stocks, 5 percent in private real estate and 5 percent in private equity firms.
Millard said he thought he had little choice but to seek a higher investment return in part because Congress had limited the agency's ability to charge higher premiums based on each plan's likelihood of drawing on the agency's funds. The agency's board - which consists of the secretaries of Treasury, Labor, and Commerce - approved the new investment strategy in a meeting in February 2008.
Just in time for the thing to collapse.
Seeing as this "crisis" has been ENGINEERED ON PURPOSE by same said a-holes, SOMETHING is a-STINKIN'!!
Bushbama are BANKRUPTING the American people FOREVER and that will lead to the DESTRUCTION of the UNITED STATES and the creation of a NORTH AMERICAN UNION under the guidance of a GLOBAL GOVERNMENT!!
What do you think they are meeting over in London? "Fixing" the VERY PROBLEMS THEY CAUSED?
But the board members have had only a limited role in the agency's operation, meeting only 20 times over the 28 years before 2008. The board is also too small to meet basic standards of corporate governance, according to an analysis by the Government Accountability Office.
"The whole model of having three sitting Cabinet secretaries with day jobs overseeing a $60 billion investment portfolio and occasionally owning significant percentages of large American companies is fundamentally flawed," said Belt, the former agency director.
The Government Accountability Office is preparing a new review of the investment policy, but in the meantime it continues to place the agency on its list of federal programs at "high risk."
--more--"Oh, yeah, about that pension you were expecting:
FLASHBACK:
The stock market's decline has already ravaged your 401(k) plan. Now it could hurt your pension, too.
Under a law that took effect last year, underfunded pension plans may be forced to limit lump-sum payments and suspend cost-of-living increases for retirees. In addition, some plans could be frozen, preventing current employees from earning credit for additional years on the job.
But our LYING, LOOTING LEGISLATORS can take credit for a DAY and the RICH CEO ABOVE HERE can get GUARANTEED BENEFITS while YOUS IS TAPPED OUT!!!!!!!
Holy shit, AmeriKa!!!!!!!
HOW MANY FARTS can you SUCK ON without LOPPING OFF SOME HEADS, huh?
"Companies are going to have to make drastic decisions about their pension plans," said Peter Austin, executive director of BNY Mellon Pension Services, which advises businesses on retirement plans. Pension funds are typically invested in a mix of stocks, bonds, and other securities, most of which have fallen sharply. By some estimates, thousands of pension plans could be affected by the law because their funds have become so depleted....
What, NO BAILOUT?? ALL THAT $$$$ GONE to WAR LOOTERS and BANKS while YOUR PENSIONS were UNDERFUNDED and LOOTED by FINANCIERS???!!!!
Are YOU FEELING a MIGHT INSULTED, Amurka?!!!!!
The law has already started affecting some local employers. For instance, Boston book publisher Houghton-Mifflin Harcourt Publishing Co., notified its 5,000 employees last week that effective April 1 they no longer have the option of receiving a lump-sum payout at retirement. Now, they can only receive half the money, with the rest paid in traditional monthly payments.
How many shits in the face can you take, America? You gobbling it up?
Also see: The Textbook Industry
"We had no choice," said Houghton-Mifflin spokesman Josef Blumenfeld. "The law doesn't leave us with any latitude."
We had no choice, we had to retain talent, blah, blah, blah, blah!!! Pfffffttt!!!
Nortel Networks Corp., a telecommunications equipment maker that recently filed for Chapter 11 bankruptcy protection, said it was also required to stop making lump-sum payouts because its pension was underfunded. Nortel, based in Canada, has 30,000 employees, including about 680 in Massachusetts.
So WHERE does all this MONEY GO, anyway? Where the f*** does it go?
While the way retirees receive their pensions may be affected by funding problems, the plans themselves are not at risk. Even if a company files for bankruptcy, most traditional pensions are guaranteed by the federal Pension Benefit Guaranty Corp. - up to $54,000 annually for someone who retires at 65. The agency said it guarantees more than 29,000 private pension plans.
Yeah, YOU GOT IT, taxpayers!!! YOU ALREADY WAITING with a BAILOUT for these guys!!! Heck, you will be PICKING THEM UP from EVERYONE!!!!!
See: Corporate Pension Funds Next in Line for Bailout Loot
But the law does require companies to cut back on some benefits that employees may have counted on, said Robert D. Webb, a partner at the Boston law firm of Nutter McClennen & Fish. Webb said the restrictions are intended to act as a "safety valve" to ease pressure on underfunded plans.
Do you FEEL LIKE a DUPE YET, worker?
Specifically, when pensions are less than 80 percent funded, the law bars companies from disbursing more than 50 percent of a benefit in a single payment.
While retirees traditionally receive a pension as a lifetime monthly payment, roughly half of companies offer lump-sum payments, said Carrie Duarte, a principal at PricewaterhouseCoopers' human resources practice in Boston. Most workers who have the option take it, she said, so they can have more control over their money by investing in a tax-deferred retirement account.
You are REALLY GETTING the SHAFT in EVERY ORAFICE, aren't you, Amurkan worker? Where are you? Why are you not revolting?
The law also makes it more difficult for companies to sweeten pensions, such as by adding early-retirement benefits, cost of living increases, or faster vesting. The restrictions don't apply to public pension plans covering government workers.
Yeah, UNLESS you are a CEO of SOME FINANCIAL FIRM!!!!
And those government pukes? They cut themselves a good enough deal as is!!!!!
The law becomes even tougher when plans fall below 60 percent funding levels. Companies are then barred from making any lump-sum payments or providing "shutdown benefits" - accelerated pension payments - that some employees are promised if their offices close.
Is it OKAY that THEIR PROMISES are SHIT, readers? You went and worked hard every day (unless you are in government, save cops, firefighters and teachers) on a CONTRACTUAL PROMISE, and yet HERE the CONTRACT has CHANGED (but not for AIG guys, no, gotta adhere to those or the whole system will collapse, oh)!
WTF has HAPPENED to America?
That is why I SAY it is AmeriKa now, because THIS is OUTRAGEOUS!!!! This NATION has been LOOTED!!!!!!!!!!!!!
For pensions that cover union workers at more than one firm, the law requires restrictions on lump-sum benefits when they fall below the 65 percent funding threshold or suffer other liquidity problems. More than 100 such plans nationwide were critically underfunded last year, according to the US Department of Labor. That included the New Bedford Fish Lumpers Pension Plan, which notified the Labor Department in April 2008 that it faced a deficit and was considering trimming benefits, including early-retirement and disability payments....
Yeah, fuck the fishermen and their hardships, huh? I'm so god-damned disgusted by this, that is why you are getting the spew!!!!
Jerry Mingione, a principal at Towers Perrin, a Connecticut company that advises businesses on retirement benefits, estimated that nearly half of pension plans may have to limit disbursements unless they step up contributions or find other ways to avoid the restrictions....
Yeah, right; bankrupt businesses are going to plow money into pensions when they can fob it off on the government. Quit lying to us, will you, Globe?
Duarte of PricewaterhouseCoopers said she has spoken to executives at Massachusetts companies who are scrambling to ease the impact on workers. For example, she said, some are contributing more money to pension plans, while others are looking to trim benefits.
I'd like to see these "some" they keep talking about, as opposed to "others." Damn, that's a common theme that runs through the propaganda we call "newspapers" here in AmeriKa!!!!
"We are having many more discussions," Duarte said. "Companies are trying to do the right thing."
--more--"
