Florida Pension Fund Loses a Quarter Its Value
November 18th, 2008This isn’t your usual Florida story. It also contains the phrase, “No need to panic.”
Via: Forbes – AP:
Florida’s public employee pension plan has lost more than a quarter of its peak value, but Gov. Charlie Crist and other officials Monday said the fund is built for the long haul and there’s no need to panic.
They said Florida has fared no worse than most big investors – a bit better than some major Wall Street indicators – due to slumps in the stock market, real estate and other segments of the national and world economies.
The fund, which covers state and local government employees including teachers, lost $37.9 billion – 27 percent – over 13 months through Oct. 31, said Dennis MacKee, spokesman for the State Board of Administration. That dropped its value to $100.5 billion.
The three-member board chaired by Crist manages 34 public funds totaling $125.4 billion, including investments for the Lottery, the state’s hurricane catastrophe fund and local governments. The largest by far, though, is the retirement plan covering almost 1 million public employees, retirees and their families.
“All funds are down all over the country, let’s face it,” Crist said. “Florida’s a lot better off than most.”
The other board members are Attorney General Bill McCollum and Chief Financial Officer Alex Sink.
“No need to panic with this at all,” McCollum said. “We should expect to be where we are now and we should expect as the market recovers so will this fund, and handsomely so.”
This isn’t your usual Florida story.
For those of you who have never read Fark.com, here is a classic example of what I am reasonably certain Kevin means by “your usual Florida story”.
As to the pension story, it really goes to show that we have exposed far too much of society’s money to the Ponzi-scheme into which the fat-cats have made the various financial markets.
Ahhh, yes….”You’re in it for the LONG term”… That’s the mantra during every market crash. Ask the Japanese what long-term means (since their market has yet to return to levels reached over 20 years ago).
Better yet, if you’re bank calls all in a panic because you’ve missed six payments already and they’re threatening foreclosure…just soothingly reassure them to RELAX, and quit staring at your mortgage balance on a day-to-day basis. After all, it’s one of those new 40-year mortgages. So obviously they’re “in it for the long term.”
As it were one of my sister’s is a Florida person whose pension is in Florida’s retirement system. Heavily invested in AIG this fund was and is.
I have not yet been able to scrape my sister off of the floor of her depression.
Like in the Wizard of OZ – when the wicked witch got water thrown on her and said I’m melting- the Florida system of investments for its retirees is melting.
Telling people to stay in it for the long haul is so comforting, so dumb. Those words are to prevent a run on the Florida retirement fund, and may hopefully do just that.
If you pull your money out now you pay all the tax on the deferred income. Not exactly a smart thing to do but sheesh, at least you’d have something left of your hard earned savings.
Stay in it for the long haul?
Exactly what is the long haul here? Watching the Florida retirement fund go down to zero in value?