Apparently not. Over at Neighborhood Effects, Eileen Norcross explains how New Jersey’s pension fund is considering buying troubled loans and securities, or “toxic assets” because it believes that they could provide a good return on investment.
Never mind, she writes, that:
New Jersey’s pension has been in crisis for a while, in part because the market has fallen, and in part because of fiscal manipulation and abuse.
The state has bonded to pay for it, deferred contributions for several years and played with the valuation rules to get the books to balance — all while expanding benefits. Grantees have also exploited the system, using gimmicks to increase the size of their pensions such as tacking on multiple jobs, boosting base salaries, and getting benefits for part-time work.
According to NJ.com, “[…] Governor Corzine believes the program could provide a lucrative opportunity for New Jersey’s pension fund.” Sure. As we’ve seen in the last six months, toxic assets really make for great investments.
Read the whole post here.