The Entire Pension System Is A Ticking Time Bomb
By Dave Kranzler
GoldSeek.com
Monday, 19 October 2015
Forewarned is forearmed: If you have the ability to cash out of your 401-K plan, you should do so now or be prepared to suffer the consequences of the most corrupted Ponzi scheme in financial market history (notwithstanding the U.S. Treasury debt scheme)
It’s been my belief that one of the primary reasons the Fed is propping up the stock market is to prevent a complete catastrophe in the nation’s pension system – both public and private. The culprit is underfunding. The underfunded of status of every single State pension fund is highly visible. However, through the magic of GAAP accounting and widespread upper management corporate fraud, most private pension funds may be even more underfunded than State funds.
The pension fund “time bombs” are beginning to detonate. While the troubles with the Chicago and Illinois public retirement funds have been widely reported, last week a $17 billion private sector “multi-employer pension pension fund” announced that many of its beneficiaries will soon incur payout cuts as high as 60%. This was not mentioned in the mainstream financial media: Central States Pension Fund payout cuts
This is what happens when payout liabilities “catch up” to an underfunded asset base.
The total size of the retirement asset market is around $18 trillion. Media attention gets focused on State pension funds, nearly all of which are significantly underfunded. In fact, one study showed that as of last year every State fund was underfunded and the cumulative amount of underfunding was $4.7 trillion: LINK. It’s probably safe to assume that corporate/private pensions are underfunded as well by at least that much.
Here’s a recent article from the Denver Post which offers a surprisingly candid assessment of the Colorado Public Employees retirement fund (PERA):
PERA’s unfunded liability rose last year (to $24.6 billion) and its state and school divisions — its largest — each finished at a funding level lower than the year before: 59.8 percent and 62.8 percent, respectively. These figures fluctuate, of course, but the funding levels for both are lower now than they were in 2010 when the system’s reforms kicked in. LINK
The Rest…HERE
