Pension Time Bomb Explodes

Mish, the prolific blogger at GlobalEconomicAnalysis is reporting:

"Pension Time Bomb Explodes In US and Canada

The ticking time bomb of overpromised, underfunded public pension plans has finally exploded. Here are a few headlines to consider. My comments appear at the end starting with the bold heading “Future Expectations Too High”

I recommend reading the whole thing - it is a great survey of what's happening to pension plans around the country. Mish is known for his blunt and incisive commentary. He writes:

The above is just a random sampling of hundreds of articles about pension plan woes. 40% of pension plans are underfunded and that assumes future returns of 8% annually. Good luck with that.

...

Taxpayer Backlash Brewing

A huge taxpayer backlash against overly generous public pension plans is brewing. Boomers with destroyed stock funds and IRAs are not going to want to have taxes increased so that public workers can get 90% of their salaries for the rest of their lives during retirement.

Vallejo California went bankrupt over benefits earlier this year. Expect to see more cities and counties take that action if the stock market continues to decline from these levels.

These are some dire warnings coming from a insightful market observer...