It's happening and almost nobody knows it. Pension funds are underfunded all over the nation -- in cities, counties, states and the federal government. The know-nothing politicians are being blamed. On top of that, municipal bonds everywhere are imperilled. Take that together with the bear market in longer-maturity bonds, and you have the makings of a vast, underfunded fiasco. Analysts thought the trouble would arrive in four or five years. But the markets discount, they look ahead, and protect themselves far ahead of the actual event.
It's amazing. Wednesday morning I checked 12 newspapers and only one, Investor's Business Daily, carried the story of underfunded pension funds. Chicago is the next candidate to run into pension trouble, but not a word about it in most of the papers.
The average American (unless he's depending on his pension money) does not know what is happening. You see, there's no D-J Average for bonds. If ... Log in or subscribe to continue reading.
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