Pensions Brace for Private-Equity Losses

[mahatmakanejeeves]

Public pension funds are already reporting big losses in 2022, and things are likely to get even uglier

wsj.com
Pensions Brace for Private-Equity Losses
Retirement officials predict grim results from investments in private equity and other illiquid assets.

Link to tweet

[jimfields33]

1. Yeah most places already have a deficit on their pension plans

For some reason many districts didn’t put enough money into the pension funds and now they’re playing catch-up, but the stock market is anemic. How they’re going to get themselves out of this is a mystery.

[empedocles]

2. Suspect pension plan managers want to look competitive, save their jobs.

So they invest shorter term with risk.

Now they are worrying about a 2020 type 10,000 DJ point drop.

If they were investing on a long view - the dow was 10,000 in 2010, they would have cushion to lighten risk in the dj 30,000g to 35g range, and would be better off now. Long bonds would have gained for some more cushion.

[MichMan]

3. Looks like tax increases are on the way