Thursday, July 16, 2015

Greece-Like Problems Lurking In The United States

While marginalizing Greece as an aberration within a sound global economy sells politically, it has not place in the investment world. US State pensions face $1 trillion dollar funding gap in a world increasingly dependent on centralized promises. Even more troubling, this number is trending higher at an alarming rate.

While the public remains largely obviously to Greece-like risks in their own backyard, they'll certain pay more attention when the invisible hand (Review of the US Dollar Index) forces a painful 'renegotiation' of ironclad promises.

Headline: State pension funds face $1 trillion funding gap

More depressing news for workers who depend on a pension to fund their retirement: State-run pension funds faced a $968 billion shortfall in 2013, up $54 billion from the year prior, according to a new report by The Pew Charitable Trusts. When local pension fund shortfalls are factored in, the total pension funding gap surpasses $1 trillion.

"Policy makers are going to need to find a way to address [this funding gap] and it’s going to have to come down to some kind of plan to pay it down in an orderly fashion," said David Draine, a senior researcher at Pew Charitable Trusts.



Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.