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Archive for December 1st, 2008

FYE 9/30/08 – A Little Help from OPEB

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For the subset of S&P 500 companies with fiscal year ending September 30, global defined benefit pension plans registered an aggregate net loss in funded status of $1.945 billion for the fiscal year ending on 9/30/2008. After adjusting for tax timing differences, that amount goes straight to the balance sheet: a hit to shareholder equity of about $1.25 billion.

But wait a minute. We all know by now that the net pension funded status erosion is primarily the result of two major counter-balancing forces: an even worse loss in pension assets due to atrocious investment returns; offset by actuarial gains arising from lower pension obligation amounts, as measured using higher corporate bond interest rates. And since other postemployment benefits (OPEBs, predominately retiree health benefits), which are subject to GAAP very similar to that of pensions, are typically unfunded or minimally funded, won’t OPEBs help us out, giving us the actuarial gains from lower obligations without the counter-balancing asset losses?

Well, yes, but not nearly as much a haircut as one might have hoped. For the subset of S&P 500 companies with fiscal years ending 9/30, shave a little off the edges, taking about 8.9% off the 2008 shareholder hit when you combine pension plans with OPEBs. Which still leaves that S&P 500 subset with a post-tax hit to shareholder equity in excess of $1.1 billion.

(Remember, as I’ve previously disclaimed, posts such as this represent efforts of my favorite pastime. My formal work does not involve any of this, and none of it represents any position or comment that should in any way be attributed to my employer. Likewise, as always, it represents general personal impressions and should not be treated or used as formal professional advice.)

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Written by macheide

1 December 2008 at 6:58 pm

Posted in άctuary

Nice Price!

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nice priceI’d meant to fill up the Blue Bug‘s tank a week ago, before the Thanksgiving break, but pulled up to our Kroger’s gas pump intending to take advantage of the 9¢ break our grocery card would have given me, only to discover that I’d forgotten my wallet. Then forgot my wallet again this morning, this time realizing my absent-mindedness a mile from the house, so retraced the beginning of my commute, else would have had to break down and pay cash for my gas (not to mention, hope I didn’t get stopped by a policeman asking me to show my license). Then ran the Blue Bug’s tank so low getting into the office today, that I had to get my gas there instead of at Kroger’s. Still, this is by far the best price I’ve seen all year!!

It’s just a good thing the Blue Bug isn’t a member of the American Airlines fleet, or I would have had to pay some of my fuel savings for the privilege of bringing my computer and a second work bag from the office with me. After blaming their consumer-hating luggage fees on sky-rocketing fuel costs when oil rose past $140/barrel this past summer, don’t expect them to see sub-$60 oil as motivation to attempt to win back any of their passengers.

//] - abelian

Written by macheide

1 December 2008 at 2:28 pm

Posted in abelian

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Lost & Found

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Oh drat! I lost my Monarch hole punch yet again. I know, I could just use a single-hole punch along with a page from my Monarch notebook, but it just isn’t the same. Why do I insist on hiding that blasted tool every single one of the rare times I get the urge to punch me a new page?

Written by macheide

1 December 2008 at 2:09 pm

Posted in lost & found

celestial isomorphs

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easter and thanksgiving and th other variable holidays were th planets cycling against th fixed stars of christmas and valentine’s day and all th birthdays and days remembered for their intersections

so too words, some of them like comets or even singular events, others wandering back and forth against th starry sky, th eternal words that will always be remaining fixed in place

but those who were penalized in th weightings applied to th scores in a regularly given examination merely faded off, aware that they would not regain their false starts when th class was held again next season, that those whose responses were honest and pure would be weighted higher and higher in th rankings each new night

and i passed like th moon through these darknesses

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Written by macheide

1 December 2008 at 4:04 am

Posted in oneirra