Posted on 02/10/2009 8:30:40 AM PST by crushkerry
Financial institutions in the United States probably need hundreds of billions of dollars in additional assistance, and one congressman wants to harness state and local pension funds to help them.
Rather than rely more heavily on the Treasury, which has already put $350 billion in the nation’s banks, Representative Gary L. Ackerman sees an opportunity in the trillions of dollars in public pension funds. Most of the funds suffered giant losses last year in the market turmoil. But they do not need all of their assets immediately, because their time horizon for paying benefits is decades long.
(snip)
Since the nation’s banks are shaky, and pension funds cannot afford more investment losses, Mr. Ackerman’s measure also calls for the Treasury to guarantee the funds’ principal, plus an annual return of about 8.5 percent.
(snip)
A federally guaranteed return of 8.5 percent, meanwhile, would avoid such misery, and give the public pension funds a new lease on life. There would, of course, be considerable risk that the banks would not be able to generate those returns, in which case the federal government would be on the hook, as it would for any loss of the funds’ principal, under the proposal.
(Excerpt) Read more at nytimes.com ...
Is there real money in the funds or is it like Social Security ?
Just a wild guess, but I’d bet that Gary isn’t going to risk his congressional pension fund!
This idea is continually getting floated.
Just like Argentina last year. I knew this was coming.
I am all for the DEMS to do this.....it will seal their defeat. Next thought for them will be private retirement funds.....401K accounts.....403B confiscation off the top with a “guarantee” you will not be penalized in the future or you can take an earlier withdraw ........they want money and have to feed.......pigs at a trough always feed !!!
A while ago FReepers were saying the Democrats would next go after our pension funds.
When predicting the idiocy of government, it’s hard to go wrong with crazy, outlandish predictions.
This is where it gets tough for me. Do you quit a job and cash out the pension in a bad economy where getting another job is dicey, or do you keep working and watch everything you’ve saved be taken for “the greater good.?” Anybody got an answer?
Bingo....Another cash grab by our bankrupt Federal Gov’t. The people don’t realize they are being had by the political elite. When they do, the anger will be impossible to contain.
Hard to say. Most 401s and 403s are invested in mutual funds. SS is simply a ponzi scheme, but pulling money out of the 401s and 403s will crash the market completely, so they may have no value. Fundamentally, they’re different animals, but in practice,...depends on how it shakes out.
Well, Argentina nationalized pension funds to fill their budget hole. Why should we be suprised that the Dems find inspiration and guideance from a first-world country well on its way to being a third-world hole? They want the same for us.
We're in illustrious company.
You buy hysical gold and silver, you buy guns, and buy some land in an unpopulated part of your state and stock it with essentials.
Dr. Theodore Kaczynski (aka Unabomber) may have been right after all about how technology and the left would be our undoing. I don’t agree with him killing innocent people, but his work’
“Industrial Society and Its Future” looks pretty prescient right about now.
Oh, wonderful. It isn’t bad enough that the states’ pension programs have basically gotten flushed down the toilet due to crappy investments, to the tune of roughly 40% in the last year, but now they’re going to invest what’s left in banks and brokers!!!??? WTF? Those institutions are DEAD BROKE. There is so much toxic garbage on their books that they should be closed up, good assets sold off, and debt-holders paid off at 20 or 30 cents to the dollar. Leaving NOTHING for equity holders...which this genius wants to make the pension funds.
I really think that Congresscritters should have to pass both a drug test and an IQ test (with emphasis on common sense) each month...because it looks like more a bunch of them are either stupid from drugs or just plain stupid naturally.
I don’t have an answer, but I have the same question. My guess is it won’t matter if you get out early. They’ll still take it or it will be devalued through inflation later on.
Hope it works out for you.
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I think I’m going to write to my (Democrat) Congressman and tell him what a great idea this is.
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