"Switching from a heavy reliance on bonds, the Pension Benefit Guaranty Corporation decided to pour billions of dollars into speculative investments such as stocks in emerging foreign markets, real estate, and private equity funds.
"The agency refused to say how much of the new investment strategy has been implemented or how the fund has fared during the downturn."
It's not a bit surprising that the PBGC's reckless strategies were tested while President Bush was still in office, given Mr. Bush's preference for enriching Wall Street players over protecting the future of ordinary Americans. The PBGC's secrecy is another Bush-ian touch.
I can't help remembering President Bush's (and congressional Republicans') massive push to privatize social security.
We all knew that privatizing Social Security would have been risky: the early millennium's first wave of corporate scandals was evidence enough.
We all knew that the primary beneficiaries of privatization would have been 1) firms that managed Social Security accounts, 2) firms that got commissions from trading for Social Security account holders, and 3) the institutions or people that dumped stocks on Social Security account holders.
If privatization had happened, I suspect that private account managers would have invested Social Security dollars in what appeared at the time to be good, steady stocks -- like AIG, Merrill Lynch, and Lehman Brothers.
Thank God the privatization plan was thwarted.
Back to the PBGC: I'd like to know 1) which stocks the PBGC bought; 2) whether the PBGC bought large blocks; 3) if so, which large stockholders and institutions benefited from the PBGC's buys.
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