Toxic CalPERS

Image courtesy C.T. Whitman (Bush EPA)

Would you bet your retirement that someone will default on a home mortgage?

Perhaps you already have....

Toxic: High risk investments, such as junk bonds, CDO's and Derivatives.

CalPERS: America's largest retirement fund.

Retirement accounts and pension funds are supposed to be stable, safe investments. Why did CalPERS choose investments labelled "toxic waste" by industry experts?

This website tries to investigate unwise investments by CalPers money managers. For comprehensive coverage of financial problems in pension funds (including CalPers) see: Pension Tsunami

News Stories

After needing to make up billions in losses, CalPers Rolls the Dice buying the very same type of assets they lost on! This is like losing a bet, and then betting again saying "let's make it double or nothing!". (I can't believe CalPers is getting into Commercial Real Estate... a market whose imminent collapse has been widely discussed.)

CalPers and its sister fund CalSTRS (Teacher's retirement fund) lost $$ 100 billion! (LA Times, July 2009)

CalPers Is suing the rating agencies who comitted fraud by listing Toxic investments as top grade AAA. Howver Calpers should have known these "SIVs" were toxic. They do have a highly paid staff of investing experts after all!

CalPers speculated on the price of oil ...helping drive up the price of gas. (AP)

CalPers used 3rd parties instead of investing directly; now its $38 billion losses are Just the tip of the iceberg. (ZeroHedge)

CalPers sunk $1.7 billion into Apollo Managment, which focuses on investing in companies with bad credit.
Guess what happened? (Bloomberg, 3/2009)
Here are some of Apollo's bright ideas: 1.) buy Linens 's Things, which went bankrupt. 2.) Loan $2 billion to a chemical company that's now bankrupt 3.) Lose $1 billion to back out of a deal with another chemical company.
Why, why Why is CalPers investing in junk bonds????

CalPERS, CalStrs rethinking "alternate" investments in hedge funds. (Finally!)WSJ Jan 2009

2008

CalPERS dumps stocks, buys "junk bonds" Bloomberg, Aug. 2008

CalPERS Loses $3 Billion on real estate L.A. Times, Nov. 2008

CalPERS loses $46.5 billionN.C. Times, Oct 2008. (N.B.: 0.5 billion = $500,000,000)

Blog with GraphOct 2008

CalPers loses $84.1 billion ($84,100,000,000) = 31% S.F. Chron. Dec 2008