Friday, September 02, 2011

Dead Peasant Returneth

Well, the pre-long weekend Friday afternoon blog post.  If you are readingwriting this, it is a great weekend to go and get on a bike

But... to fill the void.

It's not just Marcellus Shale that is bringing Texas to Pennsylvania these days. Who knew that Texas and Allegheny County would have some similar pension strategies?

I have only one thing to say about the whole concept: counterparty risk.

Actually I was kind of shocked that Allegheny County was engaged in the Dead Peasant insurance thing, but when I looked I saw that indeed it has been in the news.  See the PG story from last year that laid it out: Pension Funds Bet on Death With Life Settlements.  So it isn't even new.  What really got me thinking was the very last sentence in that article from last year that relates to the pension board of Allegheny County's pension system.  Go and read it, then go back and read last weeks PBT story on the machinations and statements from the City of Pittsburgh's pension board. Some very different perspectives.  

PBT has a follow up letter to the editor of note on the city's pension funding miasma.  

Finally...  as much as the story du jour is the performance of the city of Pittsburgh's pension fund, the real elephant is how the other 3000+ municipal pension funds in Pennsylvania are investing their assets.  You never see those stories because virtually nobody really knows how they have their cash invested in specific enough form to matter.  there may be a few examples of transparency out there, but take the dead peasant example.  I bet there are those and screwier investments out there that never see the light of day.
and it does not follow.. but if you didn't catch it, the strangest economic development news item of the week was not about cupcakes, but doughnuts


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