Sovereign Annuities

web.actuaries.ie/sites/default/ … uities.pdf

Mmmm… improves solvency of defined benefit pension schemes, but if you were a pension trustee would you fill your boots?
They are advocating kicking the can a long way down the road.

Maybe Lenny will only grant tax relief on pension funds if the pension fund invests in Sovereigns.
Tax relief is on contributions paid in and on the investment income earned by the funds.

Make it voluntary, so if you don’t opt to move your pension funds assets to a sovereign fund you lose tax relief.
There is approx €70bn in DB and DC schemes.

Hey you could even restrict the pension funds from buying bonds in the secondary market and make the pension funds invest in newly issued sovereigns issued at a yield of 5% (tax free).
The Govt could then go out into secondary market and buy back some outstanding debt which is yielding 8%
No coercion :nin

As the govt gets more and more desperate to raise cash, a grab/theft of private pension fund money and replacing it with worthless IOUs gets more and more likely…of course it will be called something nicer than that…might prop the rotten system up for another year?

And people wonder why I say domestic default is more common than international default. It often doesn’t look like a default…

I don’t wonder but default is as default does.

This sounds like *Bernie Madoff *accounting.