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On Money Market Funds, False Promises and Faulty Premises from The Wall Street Journal

"There's little evidence to support the Journal's claims that its favored proposal for money market funds -- forcing them to float their per-share price -- would enhance financial stability. As the financial crisis demonstrated, floating-value funds are not immune to runs. Instead, this 'solution' would deprive investors and the economy of an efficient, diversified, well-regulated, and transparent tool for cash management, and a crucial channel for financing businesses, state and local governments, and nonprofit institutions."  MORE >>

Wall Street Journal Interviews Experts on Solutions to the 'Nest-Egg Blues'

Excerpt: For tips on how to regain financial and emotional equilibrium in scary economic times, The Wall Street Journal convened a panel at the Wharton School at the University of Pennsylvania. The participants were: John L. McKeever III, a chartered financial consultant ... Olivia S. Mitchell, professor of insurance and risk management at the Wharton School [and] Jack L. VanDerhei, associate professor at the Fox School of Business and Management at Temple University...

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Wall Street Journal and Credit Suisse 'Union Pension Bomb' Is Long on Drama, Short on Insight (PDF)

"The May 15, 2012 Wall Street Journal editorial entitled 'The Union Pension Bomb' and the Credit Suisse report to which it refers may provide an eye-catching headline, but it contains numerous factual inaccuracies and misleading statements regarding multiemployer plans.... Rather than acknowledging the long-term nature of pension obligations and the market fluctuations that will produce periodic and transitory periods of over- or underfunding, [the editorial] chose to capitalize on the anomalies produced by artificially low interest rates, overly influenced by monetary policies intended to stimulate low-cost borrowing, at the expense of those institutions and individuals whose long-term financial survival is dependent on savings and historically dependable fixed income instruments. The sensationalism of these conclusions may play well to those whose interests are served by eliminating any sense of corporate responsibility to the workers whose efforts are as much a contributing factor to the companies' success as those who provide the capital, but no one should be fooled by this shameless and opportunistic characterization of the current rates as market driven 'risk-free' rates, appropriate for such conclusions."

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Overview of The Wall Street Journal's Retirement-Planning Guide

Excerpt: This guidebook is ... a blueprint for building a successful retirement. We'll show you how the various pieces -- retirement savings, Social Security, relocation, new careers, volunteer work, estate planning, health care, leisure and more -- come together as you create your plan for a personally fulfilling retirement.

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Pandemic Considerations for Employee Benefit Plan Financial Statements

"Many preparers and auditors are working from home and unable to go to the office to handle or review documents. The economic fallout from the pandemic has led to cash flow problems for plan sponsors resulting in layoffs of employees and even bankruptcy proceedings. Meanwhile, the [CARES Act] has led to changes that affect plans, including penalty-free withdrawals and delays of sponsors' deadlines to make contributions for 2019. Here are some things to keep in mind related to employee benefit plan financial statements amid the pandemic."

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The Wall Street Journal's Contribution to the Fiduciary Argument

"[I] was particularly dismayed to read the August 12 WSJ editorial entitled 'The Borzi Savings Bomb,' with the tagline: 'An Obama appointee concocts a fictional crisis that will have real costs.' Apparently, in today's highly charged political environment, even the Journal editorial staff is unable to look beyond partisanship to examine an important issue on its merits, alone. As the title and tagline suggest, WSJ editors are upset with Assistant Labor Secretary Phyllis Borzi's attempt to provide IRA investors with the same protections that other retirement savers have in pension plans including defined benefit plans, 401(k)s, and 403(b)s."  MORE >>

Connecticut Journal Register Is Bankrupt Again, Pension Costs Partly to Blame

"Journal Register said print advertising has dropped 19 percent since 2009 and that it represents more than half of total revenue. Additionally the New York-based company is saddled with too much debt stemming in part from pensions. A retirement plan trust with a $3.2 million pension-related claim is the company's second-largest unsecured creditor, trailing only the State of Connecticut, according to the bankruptcy petition."  MORE >>

American Academy of Actuaries' Letter to the Wall Street Journal on Recent Pension Article (PDF)

1 page. Excerpt: The article 'Tracking the Numbers,' by Ellen Schultz on Nov. 4, could have left your readers with an incorrect understanding of the cash balance plan pension plan being discussed. When Bank of America employees were given the option to transfer money from their 401(k) plans to the bank's new cash balance retirement plan, their principal became guaranteed. While most stock investors lost money over the past few years, Bank of America employees lost none of the principal in[.]  MORE >>

Journal of Pension Economics and Finance enters New Phase

Excerpt: The Journal of Pension Economics and Finance (JPEF), the only academic journal focusing on the economics and finance of pensions and retirement income programs, announces a new editorial structure and a broadening of its mission effective January 2010. Since 2002, the JPEF has provided an invaluable and influential forum for original research and international policy debate in the pensions area. Demographic aging and tumultuous capital markets are challenging the future of retirement around the globe. The JPEF will lead the way in exploring what these factors imply for retirement security and pension sustainability, and in demonstrating which new models will ensure resiliency in retirement systems. JPEF publishes original research papers; it also offers an Issues & Policy section with reviews of the state of debate on pension policies around the world. In addition, the journal includes reviews on publications of key interest to its readers. JPEF is co-sponsored by the International Organization of Pension Supervisors (IOPS) and the OECD.  MORE >>

New Academic Research Journal Launched for Pensions

"The journal is associated with the new International Network of Pension Regulators and Supervisors which has member organizations in over 60 countries. The journal publishes original academic research papers on the economics and finance of pensions, retirement income and ageing. Papers from actuarial science and other disciplines are welcome as long as there is a clear economics or finance context."  MORE >>

Institutions Want to Educate People on How to Help with Financial Planning During This Crisis

Excerpt: The IPFW Institute for Pension Plan Management last month launched its first seven multipart online retirement planning fundamentals courses. The pension institute is a partnership between Indiana University-Purdue University Fort Wayne and the American Society of Pension Professionals & Actuaries. The modules are the first steps in a program to prepare students to take ASPPA credentialing exams. The society's credentials demonstrate knowledge and expertise within the industry. Last week marked one year since local officials announced plans to create the pension institute, the only one of its kind.

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NCEO Responds to Wall Street Journal ESOP Article

"According to data from the EBSA, ESOPs have both higher average return and lower volatility than 401(k) plans. Contributions to the ESOP come overwhelmingly not from employees but from companies, and those company contributions to ESOPs are on average 75% larger than to non-ESOP plans. Perhaps most persuasively, people who work for ESOP companies have between 2 and 2.5 times as much asset value in employer plans versus people in comparable non-ESOP companies."

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Why Financial Advisers Should Factor Tech Advances in Retirement Planning

"In the next stage of our [65-year-old] client's life, from 80 to 85, robots will be able to help him with the activities of daily living, for about 15% less than the current cost of a home-health service. By the time this client is 85, robots will not only be cheaper but more capable, and the savings will continue to increase. These future savings, and clients' increasing life expectancy, need to be factored into plans we're making today. Planners may want to set aside money for emerging technologies, and make calculations based on longer life expectancies."

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Financial Planning Aspects of Unretiring

"Because finances are often the top reason, most retirees who consider reentering the workforce need to ask questions such as: How does unretiring affect Social Security benefits and retirement accounts? How does age affect Social Security and retirement accounts? What kind of tax consequences should be considered when unretiring?"  MORE >>

Influential Tax Journal Features Respected ERISA Expert Saying 'Kill ESOPs'

Excerpt: Andrew Stumpff [and Norman Stein] have recently written a piece for Tax Notes's Shelf Project entitled ? 'Repeal Tax Incentives for ESOPs.' The article appears in the October 19, 2009 issue of Tax Notes. Professor Stein is a sought after advisor to the Congress on retirement savings policy, and is highly respected by staff policy makers in the Administration and the key Congressional tax committees. Tax Notes's Shelf Project is a collaboration among tax professionals to develop proposals to help Congress raise revenue without raising tax rates. While a close read of the article reveals more of a dislike, or debunking if you will, of the economic theories of ESOP originator Louis O. Kelso, its bottom line is ESOPs do not improve company performance, do not increase wealth consistently, and therefore do not deserve to be ERISA plans nor have tax benefits.

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SSRN Announces New Journal of Abstracts: Employee Benefits, Compensation and Pension Law

Edited by Pamela Perun of the Urban Institute, it will contain abstracts of working papers, forthcoming articles, and recently published articles on fringe benefits, health benefits, qualified and non-qualified pension plans, individual retirement accounts, executive compensation, disability, worker's compensation, Social Security, ERISA and related tax law. It will also feature articles on the economic and legal aspects of retirement income policy in the U.S. and abroad.  MORE >>

Journal of Employee Ownership Law and Finance Back Issue Set

The NCEO's Journal of Employee Ownership Law and Finance, published from 1989 to 2010, was the only professional journal in the U.S. devoted to employee ownership, ranging from ESOPs to stock options and more. This is a set of the back issues that are still in print (see the link for a list).

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Wall Street Journal v. The Facts on Money Market Funds: Response to Wall Street Journal Feb. 3 Editorial

Excerpt: ICI President and CEO Paul Schott Stevens sent the following Letter to the Editor to the Wall Street Journal on February 3, 2010. Your editorial, 'The SEC v. Investors' (Feb. 3), got it wrong. Wrong on the facts, wrong on the analysis, wrong on the strength of the SEC's rules, and wrong on the mutual fund industry's commitment to its investors.

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ERIC Letter to the Wall Street Journal in Response to Cash Balance Article of August 15, 2006

Excerpt: ERIC submitted the ... letter to the Wall Street Journal for inclusion on August 15. The Journal subsequently declined to publish the letter.  MORE >>

Wall Street Journal Columnist Takes Aim at Target Date Funds

"Author Mark Hulbert's gripe is that glidepaths consider too few variables, something reflected in the research.... While not perfect, some critics countered target-date funds are adequate for most savers and better than the do-it-yourself allocation and rebalancing alternative. Others claimed the criticism stems from a desire on the part of advisors to use more expensive managed accounts."

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