There is a high degree of ‘pension fund stress’ simmering on the economic back-burners all across the global landscape.
Here are a few examples…
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And The Latest Casualty In The Global Pension Catastrophe Is…
Authored by Simon Black via SovereignMan.com,
ZeroHedge, Jun 23, 2018 – Excerpts:
[T]he city of Wilkes-Barre, Pennsylvania is deep in the red with its police pension fund.
According to the Pennsylvania state auditor, the pension was 65.7% funded in 2011, i.e. the fund had enough assets to pay about two-thirds of its long-term obligations.
Now, that alone should have been enough to sound the alarm bells.
But by 2013, two years later, the fund’s solvency rate had dropped to 49.7%. And by 2015, it was just 38.5%.
Incredible. 38.5%. At that level, there’s simply no chance the city will ever be able to meet its obligations to retired police officers.
A few years ago, city politicians took notice of this enormous funding gap and tried to take some small steps to patch it up.
Specifically, the city proposed excluding an officer’s overtime in the calculation of his/her pension benefit.
It was a small change and certainly wouldn’t solve the bigger problem. But it would at least buy the fund a few more years of solvency.
So naturally the union sued.
And earlier this month a Pennsylvania court ruled against the city, i.e. Wilkes-Barre must continue calculating pension benefits the old way.
This helps no one; it only accelerates the demise of an already insolvent pension.
Oh, and it’s not just their police pension either. Wilkes-Barre’s pension for firefighters is hardly better off, just 46.1% funded.
Unfortunately, these pension problems aren’t unique to Wilkes-Barre. City and state pension funds across the country… and the world… are in similar, dire straits.
The city of San Diego has a $6.25 billion shortfall on obligations promised to current and retired employees.
The State of New Jersey has $90 billion in unfunded pension liabilities.
And of course, Social Security has unfunded liabilities totaling tens of trillions of dollars.
The situation isn’t any different in Europe.
Spain’s Social Security Reserve Fund has been heavily invested in Spanish government bonds for several years– bonds that had an average yield of NEGATIVE 0.19%…. Unsurprisingly, Spain’s pension fund is almost fully depleted.
The United Kingdom has trillions of pounds worth of unfunded public pensions.
Even conservative Switzerland has a public pension that’s only 69% funded – a seemingly fantastic number by today’s dismal standards.
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