Stewart Stremler wrote:
I'm not terribly convinced that it's a good idea to let bankruptcy excuse pension obligations. The people that are most hurt are typically the ones least able to bounce back.
It is, in fact, a terrible idea. However, the *correct* solution is to force those pensions to be fully funded and not under the control of the company. However, companies hate the idea of portable pensions because they have to fund them up front.
That way the obligation is discharged at the time it is incurred and becomes a part of your hiring decision rather than accounting playtoys.
Don't people get more upset when a government entity declares bankruptcy than they would if a corporation does so?
Sure, but credit for San Diego has been bad for a while. Most long term obligations have already priced that problem into them. About the only thing that will get hurt will be jobs and pensions.
And, we all saw about how much everybody cared this last election--not at all.
Subject to whims of the stock market and mutual fund investors. :(
Not necessarily. You *choose* where to put stuff. My 401K's have always offered me a set of choices from US government bonds (theoretically low risk) the whole way to emerging market growth funds (huge risk).
I choose low load index funds normally. If I find that the index fund is performing significantly better or worse than the index it is supposed to be tracking, I start looking for a different index fund that is more faithful. However, I choose to take the risk of the stock market.
(Ever notice how incestuous mutual fund boards are? They're all the same people, it seems.)
Don't personally care. I don't invest in those funds which are "actively managed". If Warren Buffet, investor god, can only beat the broad market by a 1-2% per year, then mere mortals cannot even get close to that. In fact, a low-load index fund beats almost *everybody* over the long haul.
-Stewart "Had no enron stock, AFAICT, more by luck than design" Stremler
I had low Enron stock holdings because I bumped out of an index fund that was performing too well. It turned out that the fund was not rebalancing often enough and had abnormally high Enron (and others) holdings.
I have low sympathy for most of the folks who got burned by Enron who actually had its stock directly. Especially employees who had 100% Enron stock plans. They loved Enron while it was flying much higher than it should have been instead of diversifying and taking out some of the risk.
This does *not* mean that I want to let the Enron executives off the hook (they should get sent to a real Federal prison instead of Club Fed). However, everybody loved the high flyers and laughed at those of us who were responsible and didn't buy the hype in that period.
-a -- [email protected] http://www.kernel-panic.org/cgi-bin/mailman/listinfo/kplug-list
