Courtesy of Russ Winter of Winter Watch at Wall Street Examiner
Reuters reports that the largest 100 public pension funds have around $1.2 trillion of unfunded liabilities, about $300 billion above the nearly $900 billion they reported themselves, according to a new actuarial study to be released on Monday. The pension systems reported a median funding level of 75.1 percent. I was talking to a friend in California who tells, not unsurprisingly, that folks there are convinced the “Government” will simply bail pensions out.
In terms of other pensions that Aunt Millie collects, Social Security benefits are up 1.7% next year. Auntie’s interest income and below inflation Social Security increase promise to really put this group under the gun.
So nothing is fixed in Greece, funds have not been wired, Spain has not requested a bailout, the ECB has not bought one bond… what else? Despite it all, the public concern about the Euro debt crisis has all put disappeared from Google search. Must be a bit like the folk’s in California counting on bail outs. Last time I checked debt levels were as high as ever. Is this pattern of bail out complacency behind consumer confidence? Oddly I think we can now put serious bad news out of Europe into the category of “unexpected”.
Sober Look:
Now that a series of financial black box earnings reports ( Gimmicks and Obfuscation) such as GS, JPM and C are under the bridge, Tuesday after hours brought forth some real world results from the like of IBM and INTC. IBM reports a huge time line miss which is becoming the norm: IBM (IBM): Q3 EPS of $3.62 in-line. Revenue of $24.75B (-5% Y/Y) misses by $630M. IBM saw a “falloff” in demand from North America and growth markets in September. AH trading in IBM and INTC was off 3% AH, but apparently this was offset by more gimmicks and obfuscation, this time by Moody’s failure to downgrade Spain pre-election.
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