Heather Gillers
speaker
548 appearances
11 recordings
1 series
first heard Nov 2018
last heard Oct 2021
Heather Gillers’s voice in public audio — every appearance, attributed to the second.
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Appearances
It's a challenge.
It's definitely a challenge.
And so you are starting to see discussions and deliberations around stuff like, should we lower our expected rate of return, which would mean asking for more money from government employers and or employees?
Or should we add more alternative types of investments, which might bring in higher returns, but also add risk?
You've seen them move further into alternative types of investments like private equity and real estate and infrastructure, and those can be very profitable and lucrative for pension funds.
Certainly there have been examples of funds faltering along the way.
It's maybe you might call it like a more varsity level type of investing than maybe your typical county pension fund is used to.
But some of the bigger funds have had a lot of success in those areas as well.
That's right.
This is not a new problem.
Pensions have been grappling with whether they can earn the returns they expected for quite a while.
And pension expectations have gradually come down over the past couple decades.
Around 2000, they were at about 8%.
Now they're closer to about seven, median assumed return of seven over a multi-decade period, 7%.
So pensions have adjusted their expectations somewhat in large part in response to that drop in bond rates.
I think what happened in the first quarter was that you really saw an expectation that rates would stay low years out.
And so you saw the various pension managers and consultants who try to forecast what will happen with bond rates over the next decade, lowering their projections.
Because while in December 2019, it looked like maybe bond rates will pick up a little bit, by April 2020, that really didn't seem like a short-term likelihood.
So pensions are a pretty ironclad guarantee in the view of US courts.
They've protected pension promises to workers repeatedly.
Showing 81–100 of 548 · page 5 of 28
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