Description: Comments from Eric Friedman on “The Debate over Applying FE Principles to the Funding on Public Pension Plans: A Transition Proposal and Other Ideas,” by Thomas Lowman

Description: Part 2 proposes solutions to the second of three flaws of the current financial model to obtaining the fair value of the public sector employer’s pension benefit liability.

Description: Defined benefit DB pension plans continue to dominate the retirement landscape for the roughly 20 million state and local government workers in the United States. In most state and local plans, pension benefits are protected by constitutional, statutory, or common law guarantees. In many cases, these guarantees make the benefit promises to participants virtually free of risk. Finance theory is unambiguous that the discount rate used to value future pension obligations should reflect the riskiness of the liabilities.

Description: Eric Friedman’s comments on ‘The Case for Stochastic Present Values,” by Dimitry Mindlin

Description: Author response to Eric Friedman’s comments on ‘The Case for Stochastic Present Values,” by Dimitry Mindlin

Description: Part 1 proposes solutions to the first of three flaws of the current financial model to obtaining the fair value of the public sector employer’s pension benefit liability.

Description: The current financial model put forth as the market value of public sector pension benefit liabilities is simply the expected cash flows of the accumulated benefit obligation, as defined for current private sector financial reporting, discounted using a risk-free yield curve. This model is in serious need of an overhaul. This monograph addresses this issue.

Description: Review of Fifty-Second Annual Report of the Board of Actuaries of the Civil Service Retirement System. The authors found it to be a concise well written report discussing a number of issues facing all pensions in an inflationary economy. Both the title and the dull format in the usual Government Printing Office style would seem to insure this document's instantaneous consignment to dead storage. However, behind the cover of this small pamphlet is a concise, well written report discussing-a-number of the issues facing not only federal pension programs at the present time, but all pensions in an inflationary economy. For example, several of the 11 pages devoted to the main report discuss the implications of static assumptions ignoring inflation as opposed to dynamic assumptions including inflation.

Description: Part 5 addresses various purposes for measuring a public sector pension liability and which measures have the most practical usefulness.

Description: Paper discusses transition considerations if bond-based discount rates are used for funding public pension plans.