Nation's Largest Public Pension Fund Posts a One Percent Return
California's moment of fiscal reckoning draws ever closer.
4:15 PM, Jul 16, 2012 • By MARK HEMINGWAY
Just when you thought the state of California couldn't possibly receive any more bad economic news:
That's below the inflation rate. It should also be a wake-up call. Many states have been putting off plans to address pension shortfalls by continuing to bank on wildly optimistic rates of return. This news about CalPERS's dismal return on its investments should force state pension funds to start dealing with reality. (Note that California's other big pension fund, CalSTRS, which is responsible for teacher pensions also posted an abysmal 1.8 percent return on their investments.) Meanwhile, Sacramento is in such denial they're currently consumed with a $100 billion high speed rail boondoggle.
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