Could Rising Rates be THE Antidote?

By: Russ Kamp, Managing Director, Ryan ALM, Inc.

I penned this post on May 3rd. Markets have continued to sell off, but pension funding has continued to improve as rising rates and the impact on longer-duration pension liabilities created an environment that had liabilities falling to a greater extent than pension assets. Many of the points that I raised in my post appear in a thoughtful piece produced by Zorast Wadia, Consulting Actuary, Milliman. I don’t believe that there exists a retirement plan as critically important as a defined benefit plan and I’m very pleased that Zorast agrees. Let’s hope that rising rates do lead to the thawing of frozen DB plans.

2 thoughts on “Could Rising Rates be THE Antidote?

  1. Mark my word. One or a few multi-employer pension fund(s) pushed PBGC to allow 30% invested in stocks.

  2. It could be the plans or it could be investment managers of equity products that didn’t like the idea of roughly $82 billion being handed out to only fixed-income shops!!

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