I’ve created a new chart, which will be updated monthly,showing the balance of the city’s combined pension plans in comparison with the stock market, tracking S&P 500 index. Unfortunately, as I’ve pointed out previously, the city’s pensions are largely invested in risky assets which makes the entire plan correlate well with the markets. Please see the chart below:
Please note that the chart is quarterly before 2009 as this is the time period in which the city has published its pension balances. After that date, they have been publishing them on a monthly basis. They haven’t posted May or June of this year yet, but based on historic correlation, we’re in for a big drop. The S&P 500 has dropped about 13% in the last two months (reflected in the chart above). (Please also note that these numbers are as of the last day of each month)
While the city raised income taxes solely to fulfill their fiscal year 2011 pension contribution of $15 million, I estimate that in the last two months the pension plans have lost about $81.9 million in value. Oops!
