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CalPRS is lying to us. Our unfunded liabilities for the fund, according to Stanford, are $525 billion. Actually it is MUCH more--because they are overestimating their returns on investment.
"Currently GASB-adhering pension plans are required to reduce, or discount, the cost of projected pension benefit payments based on the expected rate of return on long-term investments of the plan’s assets. In effect, the discount rate allows the plans to reduce the current level of contributions from employees, school districts and state and local governments – ultimately, it’s all taxpayer dollars – by betting that that reduction will be offset by the plans’ investment gains.
The discount rate is 7.75 and 8 percent, respectively, for California’s two largest pension plans, California Public Employees Retirement System (CalPERS) and California State Teachers Retirement System (CalSTRS). The size of the discount rate is significant because most of a pension plan’s assets are tied up in investments – in CalSTRS’ case, approximately 60 percent of the funding for future benefits comes from investment returns and only 25 percent from contributions."
No one believes anybody is getting 7.75-8% return on investment. Until government agencies decide to be honest with us, they can not be honest to themselves--could this be why California is in a Depression--the lies have built up and collapsed.
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"Currently GASB-adhering pension plans are required to reduce, or discount, the cost of projected pension benefit payments based on the expected rate of return on long-term investments of the plan’s assets. In effect, the discount rate allows the plans to reduce the current level of contributions from employees, school districts and state and local governments – ultimately, it’s all taxpayer dollars – by betting that that reduction will be offset by the plans’ investment gains.
The discount rate is 7.75 and 8 percent, respectively, for California’s two largest pension plans, California Public Employees Retirement System (CalPERS) and California State Teachers Retirement System (CalSTRS). The size of the discount rate is significant because most of a pension plan’s assets are tied up in investments – in CalSTRS’ case, approximately 60 percent of the funding for future benefits comes from investment returns and only 25 percent from contributions."
No one believes anybody is getting 7.75-8% return on investment. Until government agencies decide to be honest with us, they can not be honest to themselves--could this be why California is in a Depression--the lies have built up and collapsed.
More...