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Gov't pension fund reports Y5.23 tril loss in April-June

23 Comments

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There SHOULD be some heads rolling and there SHOULD be an uproar.

10 ( +12 / -2 )

I wish I had a choice about whether or not I would like pension payments deducted from my salary each month. When I make an exit plan to leave Japan, I guess I can forget about including a pension payment.

8 ( +10 / -2 )

These clowns are gambling with the largest pension fund in the world. I'm so glad I got out of this scam. However, I can say goodbye to the fifteen grand or so I paid into it. I have my own private superannuation fund I've been into since I was in my early twenties. I know I'm ok, but the youth of Japan will be lucky to get a discounted train ticket when they retire.

9 ( +11 / -2 )

Japan’s benchmark Nikkei 225, for instance, lost 7% in the April-June quarter.

The GPIF is now making substantial purchases of Nikkei shares, and so is the Bank of Japan via ETFs (the BOJ is the only central bank that purchases equities). The Nikkei should be making huge gains with all this new money snapping up its shares, but it still marked a loss over the April-June quarter. Worrisome.

5 ( +5 / -0 )

A -0.42% return since 2014 VS +2.630% annualized Nikkei-225 Return!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

If this doesn't get people out with pitch forks and torches Japan is truly sunk.

4 ( +5 / -1 )

I have been forced to pay into this big money black hole for 24 years now and have paid more than 8 million yen( excl my employer) into it. Hope there is still some money left in it when I turn 65.

6 ( +7 / -1 )

I believe the markets have actually bounced back from the initial Brexit shock..the yen too. So I don't think they can reasonably blame Brexit for this ludicrous loss. ...unless they made the rookie mistake of getting out after the initial shock was already over?

1 ( +1 / -0 )

Jiminto is responsible for this fiasco. Jiminto lost Social Security money years ago by throwing it away on silly things its members bought just to put their names on their insane projects. Now Jiminto is again throwing away Social Security money on one of its stupid schemes to "make money" on the stock market. Time after time the retirees are seeing their Social Security payments reduced. And nobody gets excited. I know of retirees who are actually suffering because of this ... and nobody complains ... except to me and my wife. Why doesn't somebody, anybody, go after those clowns who are handling our retirement money? Oh well ... same old question, same silence. Can't figure it out ...

2 ( +3 / -1 )

What they're not telling you is the proportion of the money in govt pension funds that's being used to buy Japanese government debt/bonds. Nearly 90% of the money put into postal savings accounts is used to buy these bonds in the largest Ponzi scheme the world has ever seen. Get your money out of Japan while the getting is good - buy US$ or UK sterling, or gold while the yen is strong, or the pound/euro are weak. If the Japanese government has to go to the international bond markets instead of relying on citizens' savings (and it will), Japan is going to implode financially. Given that 40% of adults are now marginally employed (i.e. part-timew/o benefits) and 25% have no savings, it is not a matter of if, but when, this is going to happen. The emperor has no clothes.

6 ( +7 / -1 )

Gambling is illegal in Japan

Horse racing, boat racing, bike-racing, motorcycle racing, pachinko and slot machines.......

Gambling is illegal? ROFLMAO!

1 ( +2 / -1 )

As for the pension scheme here, I refuse to pay into it since my wife lost hers in the scam from several years back where the government conveniently lost over 60 million pensions and all data related to them! She started paying back into it again, but now stashes a large portion of her money in a private scheme because she no longer trusts the J-government.

4 ( +4 / -0 )

Jiminto is responsible for this fiasco.

Not really. Advisors have been telling the Japanese government to be more aggressive in its investing and telling it to put a larger share of funds into the stock market for many years. When the current strategy was implemented in 2014 October pundits generally applauded.

In fact the Japanese pattern is very similar to what has happened with the largest pension fund in the United States (CalPers: California Public Employees Retirement System).

Just like the Japanese government fund, CalPers has had its largest lost since the 2007-2008 financial crisis and the explanation is the same. The stock market.

http://www.zerohedge.com/news/2016-07-18/largest-us-pension-fund-suffers-worst-annual-return-financial-crisis-due-heavy-stock

The Japanese case warrants special comment only if its performance is proportionally worse than other large public pension investment funds.

-3 ( +2 / -5 )

Never mind, we've got the Olympics to pay for. That concrete doesn't fund itself. So a generation goes hungry after paying in for 40 years, so what? look! Colourful lights and running around!

1 ( +2 / -1 )

Bullfighter -

" Wall Street Journal in 2014 - "Japan’s $1.1 trillion government pension fund is betting that a long-term recovery and rising corporate profits will push Tokyo stock prices higher, helping the fund increase returns for the nation’s retirees. Mr. Abe has pushed for the fund to become a more aggressive and sophisticated investor. The fund decided in October to shift its portfolio to seek higher returns, slashing its target allocation to domestic bonds almost in half while nearly doubling that of domestic and foreign equities."

Expectations that Mr. Abe’s policies will succeed have already helped double Japan’s benchmark stock index since late 2012. Further gains would no doubt benefit GPIF’s ¥23.9 trillion ($202 billion) domestic stock portfolio.

Oops.

Less than 2 years later, Abenomics is in tatters, the Japanese economy yoyo's from recession to negligible growth, while the stock market has slid into a bear market having lost a quarter from its recent highs as a result of a surge in the Yen as the BOJ has largely wiped out all of its credibility with the now widely mocked decision to unleash negative rates.

And while all of the above is terrible news for Japan, whose demographic implosion assures a deflationary black hole no matter how much money the BOJ prints, those most impacted by Abe's reckless decision are the country's pensioners. Because as we concluded in December 2014, "unfortunately, for Japan, and its tens of millions of pensioners, the only news here is simple: the entire country is now held hostage by Japan's last-gasp attempt to prove Monetarist and Keynesian policies work. Because, said otherwise, "Abenomics better work, or else all your pensions are toast."

Abe even had the gall to delay the widespread release of this failure till after the July elections. Creep.

Abe / Aso Inc bear responsibility for this debacle - no outs. But they will never man up.

2 ( +4 / -2 )

I'm having trouble accepting this statistic! And for a long term investor to blame short term effects... They must be exaggerating, they couldn't be that incompetent!

1 ( +1 / -0 )

The Ponzi Scheme exposed. Face it, it's a sham/scam and you'll get zero from it.

2 ( +2 / -0 )

I refuse to pay into it since my wife lost hers in the scam from several years back.

I don't pay into it either because my school doesn't offer it, but I believe My Number will take care of that within the next few years, and we'll have to make back payments. What a waste, especially now when we know what a total sham it is!

0 ( +0 / -0 )

I'm self employed and do not participate in this scam either. The pension well is drying up fast and will not be around in 15 years.

2 ( +2 / -0 )

Big money being gambled with by big boys.

0 ( +0 / -0 )

No big deal, these are the results ending in June.

Long term, what do you all think the GPIF should be buying? Negative yielding JGBs?

Foreign stocks at least is the way to go, long term, if you want to grow your pie.

You do not get all scared and upset after 6 months of declining stocks. If anything you ought to think about buying more, and I assume when the GPIF rebalances it will have to.

Japanese stocks, different story. Should not be invested in those, unless there is a third arrow to finally boost growth.

Also people ought note that the GPIF is not where the pensions are paid from. Most is paid for by premiums paid by today's workers. The GPIF is only supposed to help out a bit to that workers don't need to pay quite as much premium to support this scheme.

That all said it is a stupid system because having your shrinking workforce support your bulging pensioners is fundamentally unsustainable. But investing to grow the GPIF is the right long term strategy.

Don't buy high and sell low folks.

0 ( +0 / -0 )

You ain't seen nothing yet.

4 ( +4 / -0 )

Again a whole lot of people here who know nothing about investment markets.

July and August have been very good months as far as global equities go.

Obviously still some way to go in this quarter, but would not surprise if the loss from the previous quarter has been made up in full in the current quarter.

0 ( +1 / -1 )

I was forced to pay into this scheme for years, I finally put a stop to it, as I seriously doubt I'll ever see any of it.

-2 ( +0 / -2 )

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