Considering the true rate of inflation, why do most pension administrators flock to low yield Govern

Graph of the housing marketIf you’re the administrator of a pension fund, your actuary will tell you that at the officially projected rate of 2.6 percent inflation, the average retiree is going to need only one thousand dollars each month to retire in 2005. That’s according to your own actuary. So you follow right along with that line of thinking. As a pension planner, you buy the type of investment that is going to generate those precise numbers. Those numbers are all you care about. If you do better than that, you’re a hero. So these people buy municipal bonds, and they don’t even have to think about it.