Politics, Weather, Photography, and the Dog
Tuesday 3 March 2009

Crain's Chicago Business reports today that the pension liabilities of several prominent employers have exploded just as their assets have imploded:

Boeing Co.'s shareholder equity is now $1.2 billion in the hole thanks to an $8.4-billion gap between its pension assets and the projected cost of its obligations for 2008. At the end of 2007, Boeing had a $4.7-billion pension surplus. If its investments don't turn around, the Chicago-based aerospace giant will have to quadruple annual contributions to its plan to about $2 billion by 2011.

... At Peoria-based Caterpillar, shareholder equity dropped more than 25% from the previous year after the company booked a $5.8-billion pension shortfall and its plan went from 93% funded to 61% funded.

That means Cat has to pay an additional 1.5 percentage points of interest to keep its untapped credit lines intact, according to SEC filings. Its pension assets sank 30% last year, and this year's contribution will more than double to about $1 billion. A Cat spokesman declines to comment.

In many cases these pension deficits will hurt exactly the people who need them most.

Tuesday 3 March 2009 07:11:33 CST (UTC-06:00)  |  | Chicago | Politics | US#
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David Braverman is the Chief Technology Officer of Holden International in Chicago, and the creator of Weather Now. Parker is the most adorable dog on the planet, 80% of the time.
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