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Reckless Illinois Politicians Put Taxpayers on the Hook via High Risk Bonds

Mad Scientist

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Because of their discredited supply side theories. Risky risky risky!

Taxpayers on the hook for risky investments in state pension systems Illinois Policy An independent government watchdog

Politicians have made a mess of Illinois’ finances, in large part through their mismanagement of state and local pension systems. With most of the state’s pension funds heading toward insolvency, it’s no surprise that politicians’ actions – from using government-worker retirements as slush funds, to trading retirement benefits in exchange for union support, to taking on too much investment risk – are being so highly criticized.

The Illinois Teachers’ Retirement System, for example, has investments of nearly $1.5 billion in junk bonds and unrated securities. It holds nearly $4.7 billion in real estate. And that’s on top of the more than $17 billion it has invested in U.S. and international equities. Bets also include derivatives, foreign currencies and other complex investment strategies.
 

occupied

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Brownback in Kansas is about to do this.
 

Mac1958

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
 

occupied

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
 

Mac1958

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

Where do you think pension funds are invested?

.
 

occupied

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

.
Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.
 

Mac1958

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

.
Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.
Because their retirement nest eggs grow and ultimately produce both retirement income for them and a legacy for their families.

All we have to do is educate people on how to do it, and/or provide investment vehicles that make it simpler.

And that's already happening. It's a good thing.

.
 

iamwhatiseem

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.

Pensions are not the problem.
Underfunded pensions are the problem.
Misusing pension funds is the problem.
Companies that use pension funds as slush funds to invest in their own ventures is wrong.
Pensions are good. Thank God I worked for a company that provided one for 26 years of my career. Private company.
 

occupied

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

.
Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.
Because their retirement nest eggs grow and ultimately produce both retirement income for them and a legacy for their families.

All we have to do is educate people on how to do it, and/or provide investment vehicles that make it simpler.

And that's already happening. It's a good thing.

.
The only sure bet on Wall Street is that working class people will be taken for suckers.
 

Mac1958

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.

Pensions are not the problem.
Underfunded pensions are the problem.
Misusing pension funds is the problem.
Companies that use pension funds as slush funds to invest in their own ventures is wrong.
Pensions are good. Thank God I worked for a company that provided one for 26 years of my career. Private company.
Pensions all over the country are in significant trouble because of all of the above and poor investment return assumptions. Now that those assumptions are being adjusted, those pensions that survive are seeing the promises made to employees decrease.

The old days are gone, and they're not coming back.

.
 

Mac1958

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

.
Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.
Because their retirement nest eggs grow and ultimately produce both retirement income for them and a legacy for their families.

All we have to do is educate people on how to do it, and/or provide investment vehicles that make it simpler.

And that's already happening. It's a good thing.

.
The only sure bet on Wall Street is that working class people will be taken for suckers.
Okay, put your money in a mattress, then complain in retirement that you have been victimized. Your call.

.
 

iamwhatiseem

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The only sure bet on Wall Street is that working class people will be taken for suckers.

Damn straight.
Last April the corporation I worked for sold our company.
I worked for them for 26 years. 16 of them as a shareholding employee.
My severance was a weeks pay for every year employed, plus share values.
I have yet to do anything with the money. I honestly don't know what to do with it.
Not about to put it into a stock market fund, we are OBVIOUSLY at the near-peak of a bubble...so that would be stupid.
Pisses me off.
 
OP
Mad Scientist

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A devalued dollar that has been under a mattress for 20, 30 or 40 years is still better than a dollar that was invested (and lost) in derivatives don't you think?
 

iamwhatiseem

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Pensions all over the country are in significant trouble because of all of the above and poor investment return assumptions. Now that those assumptions are being adjusted, those pensions that survive are seeing the promises made to employees decrease.

The old days are gone, and they're not coming back.
.

I don't disagree with that. But pension problems are the symptom of a much larger problem, not the problem itself.
20 years from now there are going to be a LOT of truly f*cked people. Americans do not save money, alas we have already returned to spending more than we make again.
I receive a pension report annually, with only a few exceptions, our fund has been 100% funded to even over 100% funded. I pray to God it continues.
 

Mac1958

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Pensions all over the country are in significant trouble because of all of the above and poor investment return assumptions. Now that those assumptions are being adjusted, those pensions that survive are seeing the promises made to employees decrease.

The old days are gone, and they're not coming back.
.

I don't disagree with that. But pension problems are the symptom of a much larger problem, not the problem itself.
20 years from now there are going to be a LOT of truly f*cked people. Americans do not save money, alas we have already returned to spending more than we make again.
I receive a pension report annually, with only a few exceptions, our fund has been 100% funded to even over 100% funded. I pray to God it continues.
I think that, in a vast majority of cases, existing pensioners are okay. I also think (actually, I know) that employers and pension funds are significantly adjusting assumptions, methods and expectations. There will be some pain, though, for those near retirement or early into it, as some promises will have to be broken.

.
 

iamwhatiseem

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A devalued dollar that has been under a mattress for 20, 30 or 40 years is still better than a dollar that was invested (and lost) in derivatives don't you think?

Sad.
The stock market has been ruined. It is no longer a reasonable choice for the retail investor. If you look at the markets pre-1990's you couldn't go wrong investing in stocks. The return stability was virtually guaranteed.
Since 1990's - it is like a bouncing ball, and after each fall instead of bouncing less - it bounces higher...you don't have to be a genius to see that this is not sustainable.
 

LordBrownTrout

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I like the last paragraph: The best solution is to move government workers onto 401(k)-style plans that give workers control over their retirements. That means no more broken promises by politicians and no more risky investments backed by taxpayers.

Correct. Pensions are the problem.

.
That way when Wall Street steals it all no one loses except the workers and who gives a fuck about them?
Very naive.

.
Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.
Because their retirement nest eggs grow and ultimately produce both retirement income for them and a legacy for their families.

All we have to do is educate people on how to do it, and/or provide investment vehicles that make it simpler.

And that's already happening. It's a good thing.

.
The only sure bet on Wall Street is that working class people will be taken for suckers.

Why do you think pensions are due accrued interest on workers backs...who have no interest whatsoever in those pensions?
 

Dont Taz Me Bro

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Been true so far that Wall Street cannot be trusted with anyone's retirement money, don't know why so many still want to do it.

I have a pension through my employer as well as a 401k and evil Wall Street hasn't stolen any of it. My biggest fear would be the government confiscating it, like was done in Argentina, if the dollar were to finally crash under the weight of our mounting debt,
 

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