by tonytran2015 (Melbourne, Australia).
When a pension fund with legislated rates of pay out operates in a negative interest environment, its fund is bound to be depleted.
You have to ask how can it have money to pay out at the legislated (high positive) rates. It can only do that if it is injected with goverment printed fiat money or if it has an ever expanding number of subscribers (a type of Ponzi scheme).
The stop on payouts byDallas police fire pension board isno surprise. It is only the tip of the iceberg.
In general, negative interest rates have revealed the unsustainability of many pension plans with legislated rates of payout.
Dallas police fire pension board ends run, bank stops 154m withdrawals.