Living on your pension, or thinking of doing so some day? Good luck! It's a measure of the craziness at this time in capitalism that your pension fund may be "investing" (that's the polite term) in hedge funds.
Hedge funds are the unregulated black boxes of speculative capitalism that routinely make billion-dollar bets on what amounts to thin air. And if you doubt me, here's how the Washington Post puts it:
"Once reserved for the wealthy, hedge funds are lightly regulated investment vehicles that are handling an increasing amount of money for middle-class workers through pension funds," the Post wrote on July 14.
"Now an estimated 9,000 hedge funds with assets of $1.4 trillion are making big bets on movements in multiple markets -- stocks, bonds, commodities, currencies, futures and derivatives."
These "bets" are just that, wagers on whether or not these markets move up or down. The hedge funds don't actually own the stocks, bonds, or currencies. Instead, they bet on whether such things are going to win, place, or show.
Now public-sector pension funds from California to New Jersey are putting down money on these bets. The San Diego County Employees Retirement Association, for instance, has 20 percent of its members' pension money invested in hedge funds, including Amaranth Advisors -- which went belly up a year ago.
Since the basic concept behind pension funds is supposed to be "little risk, guaranteed return," investing in hedge funds is "a very dangerous approach," the Massachusetts secretary of state told the Post.
But why would normally sane pension administrators start placing bets instead of making investments? Their explanation: they can't meet their pension pay-out requirements unless they hit one big!
When Poppa Pension Fund starts buying lottery tickets to make ends meet, middle-class America can start kissing itself goodbye. That's what big capital is already doing, saying there's not enough to go around, waving a sad goodbye while standing ready to take your lottery dollars.
All that's a crock. There's more than enough wealth to go around, but the producers of that wealth (that's us) are going to have to put ourselves in charge if it's going to be doled out equally.
So if they're going to bet your pension in a day at the track, don't get mad, get even! Get educated, get organized, and get moving, helping the rest of working-class America build a political party of, by, and for our class.