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Enquirica Research – Demographics and Pensions Cannot Be Ignored Forever
According to recently released research by the C.D. Howe Institute (The Glacier Grinds Closer: How Demographics Will Change Canada’s Fiscal Landscape) demographics shifts in Canada are creating the need for “immediate measures” to contain costs
Of all the age sensitive state liabilities, research by Enquirica makes it believe the developed economies are at the very beginning of the problems that will have to be faced with pension finances. Enquirica believes that significant amounts of future bail-out funds will required for struggling state pensions across the developed economies with serious consequences for already precarious public debt levels. The longer zero interest rate policies continue the worse the funding shortfall problem will become and it already appears to be serious. Studies on US municipal and state pension obligations by the Kellogg School found a total funding shortfall at the municipal and state levels of approximately $3.5 trillion. Shortfalls of this magnitude make it unlikely that there will be enough to pay promised benefits without significant additional capital in the form of higher contributions or bail-out funds. The alternatives are benefit reductions or bankruptcy - neither of which appears to be a viable option in the current political climate.
Enquirica Research is a Calgary based firm focusing on the analysis of alternative asset classes and investments, primarily in western Canada. For copies of Enquirica research register at www.enquirica.com.
DISCLAIMER: The opinions, estimates, projections and other information which is contained herein and derived from or attributable to persons other than ENQUIRICA is neither endorsed nor adopted by ENQUIRICA – it is presented for informational purposes only. Further, the opinions, estimates, projections and other information contained herein are not intended and are not to be construed as an offer to sell, or a solicitation to buy any securities, nor shall such opinions, estimates, projections and other information be considered as investment advice or as a recommendation to enter into any transaction.
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Enquirica Research is a Calgary based firm focussing on the analysis of alternative asset classes and investments, primarily in western Canada. For copies of Enquirica research register at www.enquirica.com.