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> And why did those socially vital funds invest in a boom/bust industry? Because retirees like when their funds earn more than T-bills and actually beat inflat
by voisin 4y ago
> And why did those socially vital funds invest in a boom/bust industry?
Because retirees like when their funds earn more than T-bills and actually beat inflation and that entails taking risks. Otherwise everyone can work a hell of a lot longer.
- pipodeclown 4y agoWhy are you guys talking about a bail-out? Is there any talk of that? Not as far is I know... As far as I've seen that only happens when there is a systemic/ high contagion risk...
- fragmede 4y agoRisk involves, well, risk. If commercial real estate is too big to fail, and provides better returns than bonds, then it seems like we've broken something.
- swatcoder 4y agoBut that’s the point. They didn’t take a risk pursuant to their upside expectation. They exploited an implicit insurance policy that mitigates their downside with other people’s money through bailouts. “Beat the market” on the upside, “take from everyone” on the downside. Win win!