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My bad, I was picturing my niece's boyfriend who is similar in appearance...my apologies.You are missing something because my name is not Jason...
JUSTIN JUSTIN JUSTIN.
I'll write it on the board 500 times.
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My bad, I was picturing my niece's boyfriend who is similar in appearance...my apologies.You are missing something because my name is not Jason...
And you wouldn't get the buildings, unless they are surplus which means they are worthless. There really is nothing you can take from a city government if you wish to leave it as a going concern. The only things are sports arenas and museums. That is if they are profitable and in the case of the museum you promise to keep it going. Of course, they may also be financed by their own bonds which would make it difficult to take them.
And 401(k) plans or any other money purchase plan cannot participate in PBGC.
Back on topic, govt pensions are exempt from PBGC. They are not prohibited from participating, but they are not required to contribute to PBGC like corporate pensions.
When they go belly up the covered participants get a pro-rata share of their vested benefits.
.
Pension Plans from all over the US have invested in Detroit Munis.
We analyzed 153 state and local pension plans, representing more than 85 percent of liabilities for state and local pensions and other benefits, and recalculated their liabilities using a lower discount rate. Our calculations show:
Unfunded pension liabilities are approximately $2.5 trillion, compared to the reported amount of $493 billion.
Unfunded liabilities for health and other benefits are $558 billion, compared to the reported $537 billion.
Thus, total unfunded liabilities for all benefit plans are an estimated $3.1 trillion — nearly three times higher than the plans report.
To put these liabilities in context, state and local governments’ reported unfunded obligations under pension and other benefit plans amounting to 7.1 percent of U.S. gross domestic product (GDP) in 2008.
The arenas and museums were certainly built with the bonds. And considering the state of Detroit I wouldnt be surprised if they took out more to finance the operations.
But I dont know how that would make it difficult to take them. It would just make it difficult to recoup your investment. You might trade the 10% of your bond for a -50% money pit. Because if things in Detroit where profitable then this wouldnt be happening!
push muni bonds for its tax-free interest
Tax free muni's? If so, makes no sense.
With all the investment options, I would be surprised if many (outside of MI) have a significant portion of their assets in D bonds.
I suspect the bonds on the arenas would hold a senior position as they are tied to the arena. So even if you took it over, you'd have to pay those bonds off before you could start to recoup your own bonds.
Tax free anything inside a qualified plan makes no sense.