Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: JDN who wrote (14683)	9/30/2002 7:55:51 AM
From: High-Tech East	Read Replies (1) \| Respond to of 19219

<<Well one thing you may be missing is the difference between DEFINED BENEFIT PLANS (where ultimate benefit is guaranteed) and DEFINED CONTRIBUTION PLANS (where only the contribution is guaranteed, the benefits are whatever they are)>> John ... and that realization will be good for America ... right? ... <g> --- Ken

To: JDN who wrote (14683)	9/30/2002 12:10:15 PM
From: CYBERKEN	Read Replies (1) \| Respond to of 19219

<<I have no idea what proportion of defined benefit plans still exist.>> I believe, FWIW, that defined benefit plans are mostly in older, more mature companies. A far more worthwhile accounting reform than monkeying with the slick pig of imagined stock options valuations would be a re-working of the P & L effect of these obsolete pension plans. A company taking cash out of their plans when the stock market is covering future liabilities should not be allowed to add that cash to their P & L. The proper accounting would make for a much longer post than I want to type, but it's not a new controversy, and there are very reasonable solutions. Even more interesting is the effect on union defined benefit plans, which mostly affect the same companies. Future negotiations may be centered around propping up bankrupt, mismanaged union pension plans, rather than worker's wages. Between rising health insurance and pension costs, there could be downward pressure on the actual wages paid to these union workers. The difficulties could create greater labor interruptions of production, while at the same time accelerate the movement of manufacturing jobs abroad, where there is shelter from these pension plan disasters (and lower cost health insurance-or none at all). It's a very interesting situation that bears watching...