Not a joke at all -- but no funds to do even their main mission. News: Senate Rejects Automakers Bailout.
The market will come very close to crashing tomorrow. Those people making bets on the downside will be in the chips. On Dec 11, 5:37 pm, "[email protected]" <[email protected]> wrote: > And they are pondering others such as backing credit cards, > consumption credit, etc. This is true. > > They control the US economy more that the Chinese government controls > Chinese economy. :) Just a joke. > > Peace and best wishes. > > Xi > > On Dec 11, 11:22 pm, Justice <[email protected]> wrote: > > > > > Here's the problem in a nutshell. > > > The federal government has taken over the duties as the insurance > > company of last resort for: > > > banks (FDIC) > > home mortgages (fannie, freddie, FHA, VA) > > health care (emergency services paid for by the federal government) > > healthcare (veterans, government workers) > > healthcare (elderly through Medicare) > > healthcare (unable to work for many many reasons Medicaid) > > healthcare (worker's needing services for on the job accidents) > > healthcare (long term disability through VA, Medicare, Medicaid) > > Pensions - defined benefit (autoworkers but many others) > > insurance industry itself (AIG) > > > There are funding mechanisms in the private sector for each of these > > tasks -- but the premiums didn't keep up with the risks. And no one > > has been watching to make sure that there was enough money in the > > kitty -- they had their algorithms, they had their charts and > > formulae, but no one was watching the big picture. > > > And then these separate companies -- the Big Private BAnks, and the > > big Private Insurance Company and announced that they were too big to > > fail. > > > So these debts too -- these risks, these bad pieces of paper were also > > taken on because the people in charge had lied and conned others into > > getting into the game. > > > The game has turned deadly and the big "Gangsters" Paulson and > > Bernanke are taking care of their friends first. > > > On Dec 8, 1:21 pm, "[email protected]" <[email protected]> wrote: > > > >http://www.bloomberg.com/apps/news?pid=20601109&sid=aBAw1CQXcZMg&refe... > > > > Dec. 8 (Bloomberg) -- Pension funds at Pfizer Inc., International > > > Business Machines Corp., United Parcel Service Inc. and dozens of > > > other companies have joined the parade of businesses seeking relief > > > from Congress amid this year’s economic meltdown. > > > > Instead of money, they want legislation to suspend a federal law that > > > would make them pump billions of dollars into retirement plans to > > > offset stock-market losses as many struggle to find enough cash just > > > to stay in business. They’re pressing Congress to consider the issue > > > this week before this year’s session adjourns. > > > > “The companies are not out there with their hand out for a bailout,” > > > says Mark Ugoretz, head of the ERISA Industry Committee, a Washington > > > advocacy group representing big businesses on benefit issues under the > > > Employee Retirement Income Security Act. “This is not about money; > > > this is about time.” > > > > About 800 companies in the Standard & Poor’s 1500 Index have pension > > > funds, and they were collectively $280 billion short of the sums > > > needed to pay projected benefits as of Nov. 30, according to a study > > > by New York-based benefits consulting firm Mercer LLC. Those 800 funds > > > started the year with a $60 billion surplus, Mercer estimated. > > > > To gain help from Congress, the companies will have to overcome > > > skeptics who say they are using the market plunge to undermine > > > retirement-funding provisions in a 2006 law they didn’t like in the > > > first place. > > > > “They’re trying to stampede Congress,” says Jeremy Gold, founder of > > > Jeremy Gold Pensions, a New York-based actuarial consulting firm. > > > Funds with prudent investment strategies were able to moderate market > > > losses, he says. > > > > ‘Losers’ Cry ‘Help!’ > > > > “This is a failure of risk management by America’s pension plans,” > > > Gold says. “They failed to reduce their exposure to the equities > > > markets, they continued to gamble, and they lost the gamble. So like > > > all the other losers, they’re standing on the Capitol Hill steps, > > > saying ‘Help!’” > > > > While employers increasingly offer 401(k) and similar retirement- > > > savings plans, about 44 million private-sector U.S. workers, retirees > > > and spouses still are covered by traditional defined-benefit > > > pensions. > > > > Starting this year, the Pension Protection Act of 2006 requires > > > companies to increase pension-fund assets gradually to put them on > > > firmer financial footing, reducing the chances the government will > > > have to take them over for failing. > > > > Full Funding > > > > Previously, plans generally had to have about 90 percent of what they > > > needed to meet future obligations. At the end of this year, the new > > > threshold will be 92 percent. By the end of 2011, the law requires 100 > > > percent funding. Companies that don’t reach a given year’s threshold > > > can be required to immediately jump to full funding. Plans falling > > > below 80 percent funding may face added limits on actions that would > > > further drain assets, such as some lump-sum payments. > > > > About half of the 800 companies in Mercer’s study are in danger of > > > missing this year’s target, Mercer analyst Adrian Hartshorn says. > > > World markets have been so volatile, though, that the outlook may > > > change significantly -- for better or worse -- before year’s end, > > > Hartshorn says. > > > > The 800 companies’ pension plans, as of Nov. 30, had aggregate assets > > > covering about 80 percent of projected liabilities, down from 97 > > > percent in September, Mercer reported. Those estimates, based on > > > financial statements prepared under U.S. accounting rules, give a > > > rough idea of where companies stand in relation to this year’s target. > > > The federal law, however, has its own standards for measuring pension > > > funding. > > > > Desperate for Cash > > > > Pfizer, IBM and UPS and almost 300 companies, trade groups and unions > > > petitioned Congress last month to suspend the funding mandate. The law > > > requires “huge, countercyclical contributions” at a time “when > > > companies desperately need cash to keep their businesses afloat,” the > > > group says in a letter to lawmakers. > > > > Spending to pump up pensions may cost jobs by diverting scarce capital > > > from business operations, Ugoretz says. “If a company has to dump $150 > > > million into their pension fund, they’ve got to make it up some > > > place,” he says. > > > > Atlanta-based UPS, the world’s largest package-delivery company, > > > supports pension-law changes because “given where we are economically > > > today as a country, we think that some reform that allowed those funds > > > to be used in other ways would be beneficial to the economy,” > > > spokesman Malcolm Berkley says. Calls seeking comment from Pfizer and > > > IBM weren’t returned. > > > > Investment losses by pension funds have hit companies in a range of > > > industries as the S&P 500 plunged more than 40 percent so far in 2008. > > > Houston-based Lyondell Chemical Co.’s pension fund lost $154 million > > > in the first nine months of the year, a 17 percent drop, according to > > > a Securities and Exchange Commission filing. > > > > Record Losses > > > > Assets fell a combined $130 billion during November in the S&P 1500’s > > > 800 or so pension plans, Mercer estimated. That topped total losses in > > > the first nine months of 2008, and broke October’s record $110 billion > > > decline. > > > > “Without relief, plan sponsors must shoulder the immediate burden of > > > sudden, unexpected, large increases in plan contributions at a time > > > when cash may be difficult to generate internally or to obtain in the > > > credit markets,” Mercer’s Hartshorn says. > > > > Plans with more conservative investment strategies have at least > > > softened the blow. General Motors Corp., the biggest corporate pension > > > sponsor with $84 billion in projected benefit obligations at the end > > > of 2007, is among companies that shifted assets from stocks before the > > > worst of the market rout. The biggest U.S. automaker decided in 2006 > > > to cut its target allocation for equities to 29 percent, from 49 > > > percent. > > > > GM made a “determination that, for the best interests of maintaining > > > the funded status as well as we could, we needed to make that shift > > > into the fixed-income market,” says Nancy Everett, chief executive > > > officer of GM Asset Management Corp. > > > > Notably Absent > > > > GM was notably absent from the five-page list of companies and > > > organizations asking Congress for relief from the asset thresholds. GM > > > said its pension plans had a $1.8 billion deficit as of Oct. 31, down > > > from a $20 billion surplus 10 months earlier. At that level, GM’s > > > plans would top the pension law’s 2008 asset threshold. > > > > David Zion, head of accounting research for Credit Suisse Securities > > > USA, says investment managers should have been able to control > > > volatility. > > > > “I just find it interesting: You take some risk in the plan; if it > > > works in your favor, then great,” Zion says. “If it works against you, > > > then go ask Congress for help.” > > > > On average, the 800 pension plans in the S&P 1500 had 61 percent of > > > their assets in stocks at the end of 2007, Mercer’s Hartshorn says. > > > > Bigger Stock Bets > > > > Some made much bigger bets on stocks. Investment strategies at more > > > than 20 S&P 500 pension funds allocated at least 75 percent of their > > > assets to equities at the end of 2007, according to an October report > > > by Goldman Sachs Group Inc.’s Global Markets Institute. > > > > Fannie Mae, the mortgage-finance company taken over by the U.S. > > > government, ranked fourth with 84 percent of pension assets in stocks. > > > Because of the market plunge, Fannie Mae made an unplanned $80 million > > > payment to its pension fund last > > ... > > read more »- Hide quoted text - > > - Show quoted text - --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "World-thread" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/world-thread?hl=en -~----------~----~----~----~------~----~------~--~---
