Thursday, April 28, 2011

News That Surprises No One: Equities Markets Crushed California Pensions in 2009

The Sacramento Bee reports today on a new Census Bureau report confirming what we were expecting: downturns in the stock and property markets hammered California's public pensions in 2009. The total value of the CalPERS, CalSTERS, and UCRP funds dropped from $476.2 billion in the 2007-2008 fiscal year to $340.2 billion in 2008-2009. Interestingly, California did worse than other states; our losses accounted for 21.2% of all state pension fund losses.

CalPERS Headquarters: Where Magic Happens.
According to the Stanford study of California's unfunded pension liabilities, these three funds were short over $500 billion dollars as of July 2008. And now they've lost $136 billion of their value. We'd like to hope that this news will add pressure on Sacramento to institute meaningful pension reform. At the least, we'd like to believe it could revive talk of Jerry Brown's decent start at a reform package (the proposal has rapidly disappeared down the memory hole in Sacramento). But, sadly, we're still betting that California's pension time bomb needs to explode before anyone in government starts to take it seriously.


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