Hawaii pension fund stands to lose if...

[terracore]

http://archive.is/gvvTc

"The $16.9 billion Hawaii fund in 2016 began earning money selling “put” options—essentially a bet that markets would stay calm or rise. When markets fall, Hawaii is on the hook to pay out.
“We’ve taken some losses that you’d expect with these sharp moves,” said Vijoy Chattergy, the fund’s chief investment officer, on Feb. 8.

For now, investors express confidence these strategies will work out. Others in the market, however, worry that any additional turmoil could spur institutions to quit their “low-vol” strategies. “Our fear is when these strategies unwind,” said Alberto Gallo, a portfolio manager at Algebris Investments in London. "

[Kapoho Joe]

Low interest rates for such an extended period of time was always going to result in the institutionals using these higher risk vehicles. Gone are the days where you could park your cash and count on a decent return.

[kalakoa]

Dare I ask: why is State gambling away its worker's retirement funds?

[Obie]

Because they are grasping at straws !
Read this and weep .

http://www.grassrootinstitute.org/2017/0...en-bigger/

I really like this sentence, "Island taxpayers must watch lawmakers closely this session to ensure that government spending and salary increases are kept in check without raising taxes."

This article was from last year so I guess it's too late to stop the salary increases !

"The consequence for taxpayers could be enormous.

Assuming the $12 billion unfunded liability, Hawaii taxpayers will have to pay an extra $385 million every year.

But under the more realistic State Budget Solution numbers, Hawaii taxpayers would presumably need to pay an extra $1 billion every year.

In total, this translates to $24,544 of tax money that will be taken from every man, woman and child in the state."

Would you all mind writing a check for the $24,544 that you will be on the hook for or would you prefer to pay in cash ?

[Kapoho Joe]

OLD NEWS! I found this one from 6 years back.

http://bigislandnow.com/2012/06/19/hawai...in-nation/

The issue has been what are GASB 45 obligations, short for a form from the Governmental Accounting Standards Board.

In 2006, the board began requiring municipalities to report estimated liabilities for health-care payments for future retirees for accounting purposes. During the next four years, Hawaii County made about $61 million in estimated payments.

However, for the past two years, Mayor Billy Kenoi has opted to postpone $34 million in GASB payments in order to balance the county’s budget.

The Kenoi administration notes that the county has covered its obligations for current retirees, and is not required to make the GASB payments. It also notes that the state, Maui County and City and County of Honolulu have not made any GASB payments.