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For months, if not years, we’ve warned that conflicted politicians and union bosses pursue a perverse set of goals in their management of pension funds, most of which have nothing to do with the application of sound financial principles. Here’s how we summarized the situation back in the summer (see “An Unsolvable Math Problem: Public Pensions Are Underfunded By As Much As $8 Trillion“):
Defined Benefit Pension Plans are, in many cases, a ponzi scheme. Current assets are used to pay current claims in full in spite of insufficient funding to pay future liabilities… classic Ponzi. But unlike wall street and corporate ponzi schemes no one goes to jail here because the establishment is complicit. Everyone from government officials to union bosses are incentivized to maintain the status quo…public employees get to sleep better at night thinking they have a “retirement plan,” public legislators get to be re-elected by union membership while pretending their states are solvent and union bosses get to keep their jobs while hiding the truth from employees.
Then, just a couple of weeks ago, CalPERS confirmed our fears when they chose to lower their discount rate by only 50bps to 7%, nearly a full point above their 6.2% projected annual returns over the next decade. Even more startling was the open admission from Richard Costigan, chairman of the CalPERS finance committee, that the decision was motivated by the board’s desire to maintain the ponzi, saying: “this is just a start…municipalities and other government agencies need some breathing room before they absorb the impact.”
It’s safe to say this pension fund will never make it, for numerous reasons. Benefit haircuts are coming.For some reason, Fort Wort escaped the scrutiny of Dallas. I suspect that will change soon.
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Twitter account of “Alois Irlmaier”:
“Documenting the lead up to World War 3 as predicted by German seer of same name.
#WW3 is right around the corner. Hope for the best, prepare for the worst.”
— Alois Irlmaier (@AloisIrlmaier) September 10, 2016
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– Gunman opens fire at Dallas police headquarters, leading to armed standoff (, June 13, 2015):
A lone gunman opened fire at the Dallas police headquarters early Saturday morning, authorities said, leading to a standoff that has continued for several hours.
The suspect was shot by a sniper and authorities are trying to determine if the individual is still alive, Dallas Police Chief David O. Brown said at a news conference Saturday morning.
Police said that the gunfire began at about 12:30 a.m. outside the police headquarters at 1400 South Lamar Street. Witnesses reported seeing what appeared to be multiple people firing automatic weapons at the police station, authorities said.
No officers were injured, Brown said.
– Bombs planted in attack on Dallas police headquarters (Reuters, June 13, 2015):
Bombs were planted outside Dallas Police headquarters in an attack early on Saturday that may have involved as many as four gunmen firing automatic weapons, police said.
Dallas Police Chief David Brown told reporters that a motive for the attack was not yet known, but he also said there had been threats and attacks on police elsewhere in the country in the past few months.
One of the devices, a pipe bomb, exploded when a police robot attempted to move it. Another, which was under a police vehicle, was detonated by a bomb squad, according to the police department.
– Dallas Commissioners Will Declare State Of Disaster Tomorrow Over Ebola (ZeroHedge, Oct 15, 2014):
While the message from the President is ‘keep calm and avoid bodily fluids’, it appears the commissioners in Dallas are slightly more concerned at the potential for Ebola to escalate:
- *DALLAS COMMISSIONERS TO DECLARE LOCAL STATE OF DISASTER TOMORROW: NBC-TV
- *DALLAS COUNTY CONSIDERS DECLARING STATE OF DISASTER FROM EBOLA
- *DALLAS DISASTER DECLARATION WOULD ACTIVATE EMERGENCY PLAN
While we are not sure where a “state of disaster” ranks relative to a “public health emergency” such as the one in Connecticut, we are certain of one thing – it will mean civil liberties will be reduced as government takes control.
BREAKING>> Emergency Dallas Commissioners Ct. Meeting Set for tomorrow at 2pm to declare Local State of Disaster
— Meredith Land (@MeredithNBC5) October 16, 2014
* * *Welcome to the new normal American police state.