>Doug:
>> I just posted the text of my comments on Robin Blackburn's Banking on
>> Death, his 530-page program for transforming the public pension
>> system, which I delivered at a New School conference last Saturday.
>> It's at <http://www.leftbusinessobserver.com/NSPensions.html>. Sorry,
>> it's mainly text - a few links, minimal graphics.
>
>Great piece.
Thanks.
>Two minor comments:
>
>1. You argue against "market fetishism" yet use some attributes of that
>fetishism, namely incomprehensible jargon. What does "prominence of M&A
>in the stock landscape" mean? How about "The University of California
>system, whose endowment is run on indexing principles by a small staff
>of civil servants, was long the stock and lost a bundle. Harvard, whose
>endowment is run by a large staff of professionals paid on a Wall Street
>scale, made a bundle through shorting?"
>
>As C Wright Mills aptly observed, a successful demystification involves
>a "translation" of that jargon into plain English - which he quite
>effectively did with the notoriously obtuse writings of Talcott Parsons.
>One would thus expect the same from a piece written for general
>audience.
It was written for an audience of economists (with a sprinkling of actuaries and policy types), not a general audience. Had I been writing for a general audience, I would have defined the terms, or worded the passages differently.
>2. You write: "UBS recently issued a research note that gathered
>statistics from seven rich countries on the size (relative to GDP) and
>investment allocations of pension funds. When combined with World Bank
>data on savings and investment rates some interesting results emerge. A
>ranking of the seven countries (Australia, Japan, Netherlands, Sweden,
>Switzerland, the UK, and the U.S.) by pension fund size shows an
>unimpressive correlation of .35 with national savings rates, and just
>.03 with gross fixed capital formation. When ranked by the stockholdings
>of pension funds, the signs change: -.89 for savings and -.46 for
>capital formation: that is, the bigger the wad of pension money
>committed to the stock market, the lower the level of national savings
>and investment. The sample size is small, for sure, but it does make the
>economic case for prefunded pensions a little harder to prove."
>
>Technically speaking, this is not a sample but a "population," unless we
>take a difficult to maintain position that the seven richest countries
>"represent" a larger population of countries. Therefore, the
>correlations you mention are the actual correlations as found in the
>population, not encumbered by a sampling error.
Point taken, but 1) seven countries are still a minority of even the "rich industrial core," and 2) it was only for one year (ca. 2002), not a a time series, so there could have been cyclical or noise issues.
Doug