April 2021
08Apr

Robert C. Merton and the Science of Finance

By Zvi Bodie Starting with his 1970 doctoral dissertation and continuing to today, Robert C. Merton has revolutionized the theory and practice of finance. In 1997 Merton shared a Nobel Prize in Economics “for a new method to determine the value of derivatives.” His contributions to the science of finance, however, go far beyond that. In this essay I describe Merton’s main contributions. They include the following: 1. The introduction of continuous-time stochastic models (the Ito calculus) to the theory...

April 8, 2021
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01Apr

Evaluation of Four Decades of Pension Privatization in Latin America, 1980-2020: Promises and Reality

By Carmelo Mesa-Lago The author of this book has published other 40 on social security since 1968, dealing with pensions, health care, and social assistance, in seven languages and in 34 countries. His new book is a product of many works in the last 30 years, which have been integrated, updated, and expanded under a new methodological framework. The book thoroughly documents the effects of the privatization of pensions in nine countries in Latin America from 1980 until the present:...

April 1, 2021
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March 2021
10Mar

Puerto Rico debt-restructuring plan filed amid criticism

A framework that outlines how Puerto Rico will restructure at least $35 billion in public debt and more than $50 billion in public pension liabilities threatens a 10% cut to certain public pensions if no agreement is reached with retirees. The amended plan of adjustment of 233 pages was filed late Monday in U.S. court by a federal control board that oversees Puerto Rico’s finances and was created by Congress to lift the U.S. territory’s government out of bankruptcy. The plan...

March 10, 2021
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05Mar

Chile pension reform: The big bone of contention hampering progress

The Chilean government has amended its pension reform proposals. The administration’s bill was originally submitted in 2018 and has since undergone modifications amid pressure from the opposition. Read also Financial wellness can foster pension system in China It remains stuck in the senate after being greenlighted by the lower house in December 2019. Read also Canada. Pensions seek clear strategies, lower costs through in-house management Against this backdrop, Chileans are due to elect a new president to replace Sebastián Piñera. Under the center-right leader’s latest...

March 5, 2021
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February 2021
24Feb

Puerto Rico governor rejects key deal with creditors to reduce debt due to pension cuts

Puerto Rico’s governor announced Tuesday that a federal control board reached a key deal that would reduce the U.S. territory’s overall debt by nearly 80 percent, but that his administration is rejecting it because it would require cuts to the island’s crumbling public pension system. The impasse between the governor and a board that oversees Puerto Rico’s finances threatens to throw into limbo attempts to end a bankruptcy-like process for a government that six years ago declared unpayable its more...

February 24, 2021
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15Feb

Ireland. Pensions timebomb waiting to go off unless we take action now

As we battle our way through the Covid-19 pandemic the Government has had to deal with an extraordinary crisis with no advance warning or time for preparation. However, there is another major issue that has been gathering pace for some time and which also affects everyone in this country – and that is the “pension crisis”. In this case the Government has had time to plan, be prepared and act and that time is now. Luckily, much of the work...

February 15, 2021
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12Feb

US. House Includes Pension Reform Plan in COVID-19 Relief Bill

The House Ways and Means Committee has included a pension reform provision in a COVID-19 relief bill that would create a special financial assistance program to help multiemployer pension plans and extend amortization periods for single-employer plans. Read also US. AIG to pay New York $12M for unlicensed pension risk transfer business The Butch Lewis Emergency Pension Plan Relief Act of 2021, which is included in the bill, would create a special financial assistance program under which cash payments would be...

February 12, 2021
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08Feb

Asia needs pension reforms for sustainable growth

ASIA is in a good starting position to thrive during the 2020s as it weathered the pandemic crisis in relatively good shape. Allianz SE notes while economic activity in the region declined by less than 2% in 2020, gross domestic product (GDP) contracted by more than 4% at the global level and by almost 8% in Latin America. The main reasons for Asia’s resilience, the multinational insurance group says, is robust growth of 2.3% in China, the only big economy of...

February 8, 2021
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January 2021

28Jan

Peru Congress Edges Closer to Giving State Control Over Pensions

A Peruvian congressional committee approved a bill to overhaul the country’s pension system, triggering warnings from the fund-management industry that the government will get control of billions of dollars of private savings. Read also Coronavirus throwing retirement systems into a deepening hole Lawmakers on the pension reform committee voted 6-2 in favor of legislation late Tuesday that seeks to replace the existing private and public pension plans with an integrated, government-run system. The bill will now be sent to the...

January 28, 2021
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19Jan

China:Pension system reform seen as imperative

The structural reform of China's pension system is imperative, and the country's aging population will be propelling an increase in demand for pension funds to be allocated to investments with sustainable returns and alternative solutions that provide long-term benefits, according to Ms Dong Mei, a partner and the head of Aged Care in KPMG China. In an article for China Watch, a think tank powered by China Daily, she points to several overarching trends affecting the development of China's...

January 19, 2021
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