How long can they coexist?

“Nobody knows exactly how much pensions owe or exactly what they own, but we know they were underwater before the coronavirus crash. The situation is worse now."

The “now” in that sentence is April 2nd, 2020, that is the very beginning of the COVID-19 pandemic. Starting from there, the rest of “Coronavirus Is the Tipping Point That Just Upended Pensions” elaborates with plenty of details on the following points:

• [in the past decades] pension funds… collectively decided that they’re going to beat the market rather than lower their expectations, [thus looking] for riskier and riskier investments
• over the past few years, that was a pretty good bet. In just the past month, that all changed… They bet big, they lost, and if the pensions don’t get bailed out, checks to retirees will start bouncing soon.
• there isn’t an easy way out. If pensions are underwater, they either need to get more funding or pay less to beneficiaries.
• there is one possible option, which is off the table except during a crisis: a systemwide bailout and restructuring

Now, if you read my chronicles of Italy’s lockdown, you’ll see that “systemwide bailout and restructuring” is the same thing I too was calling for, since the very beginning of the pandemic. I am still waiting, with even more reasons than in 2020 to think so. But let’s talk about 2021 now.

That was in April 2020

Fourteen months after that post, with the pandemic still messing up the economy and everything else before it, “We’re About to Enter the Cheap Money Era’s Final Phase”. I have a bad feeling about what, by definition, would be another source of “systemwide bailout and restructuring”. And I can’t help feeling that this “final phase” and the state of pension funds worldwide will cross paths, in more than one bad way. Here’s why, using the main quotes from that other post:

• Do the current “investors” in “NFTs” realize they are “buying nothing more than a link, URL, or pointer to an asset, one they don’t own and can be “pirated” with a copy and paste in two seconds flat?"
• Online echo chambers [make] an informed decision almost unattainable, if not impossible. This, combined with a zero interest rate climate in which money has lost all meaning (me: see above about pension funds, again…) has created a hotbed for fraud, deception, and villainy
• This incessant “reach for yield”… has now leaked into both tangible and digital realms. Bad actors online have the perfect platform(s) to exploit the vulnerable within the general populace who aren’t equipped to deal with top-flight sociopaths at such a scale (me: again, read this thinking to the situation of pension funds, and retirees. Not good)