Column #377 November 18, 2022
Back in November 2017 the Mises Institute published a paper titled “Will Americans Die Young Enough to Save Pension Plans?” It was a strange question then and it still applies to today? Interestingly, maybe it partially explains what Bill Gates, Anthony Fauci, Klaus Schwab (The Great Reset), and other elitists have in-store for us regular folks. In 2020 they all pushed for mandating the experimental mRNA vaccines that were never properly tested prior to their introduction. Now we know there are many hidden harms associated with the vaccine. There’s so many harms that death rates are increasing for people who have taken the vaccine and they are not dying from Covid.1 2
In the recent news blasts we’ve learned that the world’s population reached eight billion on November 15, 2022. Of course everyone wonders if the world can support that many people which inspired more doom and gloom about global warming, food shortages, the sustainability of energy and other natural resources, and more reasons why there are too many people. Countries that are experiencing slower population growth and no growth are being glorified while those whose populations keep growing are seen as a problem.
Therefore, maybe that’s why we’ve ended up with a manmade virus that inspired a novel vaccine that not only shortens the lifespans of those who take it but reduces fertility and live births! Because we live on a “finite planet” are elitists trying to reduce petroleum energy usage, lower the demand for food and shelter, and prevent pensions from imploding and impoverishing millions of families? That really sounds like a really crazy question doesn’t it?
Unfortunately, concern for the long-term viability of the entire pension industry is a legitimate concern. The risk for pensions failing increases because rising interest rates negatively impact payouts and even the pensions themselves.
Here’s how Sarah O'Brien from CNBC advises individuals thinking about getting lump sum payouts. “If the rate used is 4%, a pension benefit of $5,000 monthly ($60,000 a year) over 20 years would yield a lump sum of about $815,419, Titus calculated. At 6%, the one-time payout would be about $688,195—a difference of $127,224 and about 16% lower.”3
Another risk is underfunded programs. According to Jordan Campbell in an article from the Reason Foundation, only state-managed pension plans are fully funded. The vast majority of pension plans are underfunded. As interest rates increase and prices for bonds and stocks fall, the number and degree of underfunded pensions will increase!4 5
In an article from Forbes Magazine, Edward Siedle described that an even greater concern is the risk of a total collapse that extends beyond the pension industry. He pointed to the recent fiasco in the United Kingdom as one which nearly brought down the entire world’s house of cards. “. . . the United Kingdom saw the near-collapse of, according to some experts, nearly 90% of its pensions holding £1.5 trillion in assets. What happened is that a government-policy induced a pension crisis in the U.K. over what’s called liability-driven investing (LDI). LDI is a strategy that helps corporate pensions match their assets to their liabilities.
“Newly installed Prime Minster Liz Truss’ government unveiled a plan to cut taxes (financed by an increase in government debt of £72 billion) amid rising inflation, which pushed the country’s bond market into crisis territory. Yields on U.K. government bonds rose sharply, and this in turn triggered margin calls, which many investors tried to meet by selling more bonds, causing a chain reaction. The Bank of England then instituted an emergency intervention—an approximately £65 billion bond-buying program, doled out in daily injections of £5 billion until October 14 in order to halt a collapse of the bond market.”6
“Collapse of the bond market” is a key point here. For decades I’ve been saying “that more debt is not stronger debt. More debt is weaker debt. There is more debt outstanding today than ever before in the history of man.” When interest rates fell to near zero, and in some cases below zero, debt was less of a burden. But as interest rates increased, not only did bond prices fall, but as old debts are refinanced at higher interest rates they become unsustainable burdens for the debtors.
Pensions hold debt instruments and shares of stocks. Both will fall in price as interest rates increase. In addition, the very viability of the bonds and shares that are issued by companies and governments that are big debtors comes into question. So even if interest rates only go up another percent or two, certain bonds may become worthless because chances are the borrower may not earn enough money to pay higher interest. In that case they default on their debts.
This pension problem has been surfacing for some years now. It started with underfunded pensions that were mismanaged. Now concerns have mushroomed because, for the first time in 40 years, interest rates are in an uptrend. If this topic is of particular interest, I’ve added several more links for additional study.7 8 9
Since the pension issue is so touchy for so many people and it fits in nicely with the finite planet concept, maybe the elitists do have a goal to shorten the lifespans and lower the fertility rates of people all around the world. Who knows? But it’s something to be aware of.
To your health.
Ted Slanker has been reporting on the fundamentals of nutritional research in publications, television and radio appearances, and at conferences since 1999. He condenses complex studies into the basics required for health and well-being. His eBook, The Real Diet of Man, is available online.
For additional reading:
1. Will Americans Die Young Enough to Save Pension Plans? by Doug French from the Mises Institute
2. The Most Egregious Violation of Ethics in the History of Medicine by James A Thorp, MD. from the Robert Malone substack
3. It’s a Pension Quandary: Rising Interest Rates Make it Trickier to Choose Between a Lump Sum or an Annuity by Sarah O’Brien from CNBC
4. Projecting the Funded Ratios of State-Managed Pension Plans by Jordan Campbell from Reason Foundation
6. UK Pension Fund Near-Collapse Is A Warning For America’s Pensions by Edward Siedle from Forbes