What we’re reading (7/26)
“A Potential Deal For State Pension Reform” (Forbes). State and local governments were exempted from the 1974 Employment Retirement Income Security Act (ERISA) because they were assumed to be “model employers” that wouldn’t shortchange their employees’ pension funds the way their private sector counterparts had. That assumption proved faulty, though, as governments “have used overoptimistic investment return assumptions, taken excessive investment risk, and often failed to make their full annual contributions. Pension trustees often have not acted as true fiduciaries on behalf of pension participants, collaborating with government officials – often the very people who appointed them – to reduce current contribution costs, even if doing so left fewer resources available to pay future pension benefits.”
“Big Tech Funds A Think Tank Pushing For Fewer Rules. For Big Tech.” (New York Times). “Google, Amazon and Qualcomm finance a George Mason University institute teaching a hands-off approach to antitrust regulators and judges.”
“Thinking Of Claiming Social Security Benefits Early? The 2020 Recession Could Offer One Good Reason To Do So” (USA Today Money). There are a lot of “ins” and “outs” when it comes to deciding when to tap into Social Security, but one circumstances in which it could make sense to claim the benefits early is if it allows you to avoid realizing unanticipated market value losses resulting from a downtown occurring right before, or early in, retirement.
“Quantitative Digital Asset Investment Firm Cambrian Asset Management Closes Seed Round” (Cambrian Asset Management). More “smart money” flowing to quant funds. Not surprised at all.
“Stocks And Recessions: Assessing Recent History” (Wall Street Journal). A nice look what history has to say about whether the recent rise in equities foreshadows calamity on the horizon. Caveat emptor: the underlying health crisis causing the recession we’re in is unlike anything we’ve seen before. We (humans) can’t help trying to tease out patterns from history (or, more cynically, impose patterns on history), and are easily able to do it, even when no such patterns exist.
