Tuesday, November 18, 2014

Illinois Pension Debt Soars To $111 Billion

Everyone is pretty much betting that the state of Illinois will be the first to blow up financially, with California and New Jersey not far behind.

Illinois’ unfunded pension liability grew to more than $111 billion this year, according to official estimates. That’s a $48 billion increase just since 2009.

That $111 billion pension shortfall means the state now has only 39 cents of every dollar it should have in the bank today to pay for future benefits. In the private sector, these funds would be deemed bankrupt.

(via Infowars)

1 comment:

  1. there's more than 1 beneficiary in this game.............

    Launching More Super Secret Private Equity Limited Partnership Agreements
    Posted on November 19, 2014 by Yves Smith

    Private equity fund managers keep insisting that private equity limited partnership agreements need to remain confidential or their businesses will suffer irreparable harm. We’ve already shown that claim to be ludicrous.

    We published a dozen of these supposedly sacrosanct documents at the end of May. They had been accidentally made public by the Pennsylvania Treasury, but no one seemed to have noticed. They included funds of major industry players such as KKR, TPG, and Cerberus. Yet miraculously, they sky has not fallen in on their businesses as a result of the release of this information. We have obtained ten more limited partnership agreements from a source authorized to receive them who is not bound by a confidentiality agreement. These include limited partnership agreements from Blackstone, Oak Hill, and New Mountain, as well as smaller players. You can see all these limited partnership agreements here.

    There is a vital public interest in having this information in the open. Public pension funds, which are government bodies, are the biggest single group of investors in private equity, representing roughly 25% of total industry assets.

    Yet private equity limited partnership agreements are the only contracts at the state and local government level that are systematically shielded from public scrutiny, through state legislation or favorable state attorney opinions.

    Yet in countries less captured by rampant free market ideology and private equity political donations,

    a revolt is underway against this secrecy regime.

    In fact, as we’ve stressed, what the industry does not want to see is other critical provisions of these documents, which we and the media have only started to dig into. Those include the extensive and often impenetrable tax provisions, the egregious indemnification agreements, the waiver of fiduciary duty, weak oversight provisions for limited partners, and lack of adequate disclosure of performance and all expenses and fees paid to general partners by portfolio companies.

    There’s good reason for the general partners to want to keep these contracts secret.

    They don’t reflect well on them or on their captured investors.