Pension Pulse

Sinéad Carew and Ankika Biswas of Reuters report Wall Street ends up as investors eye data for rate prospects, energy outperforms:  The S&P 500 closed higher on Friday, in a light trading day ahead of a long weekend, as investors assessed inflation data against rate hike and recession fears while energy shares jumped on higher oil prices. A Commerce Department report showed U.S. consumer spending barely rose in November, while inflation cooled further, but not enough to discourage the U.S. Federal Reserve from driving interest rates to higher levels next year. The personal consumption expenditures (PCE) price index, the Fed's preferred inflation gauge, rose 0.1% last month after climbing 0.4% in October. A benchmark survey showed U.S. consumers expect price pressures to moderate notably in the next year, with the one-year inflation outlook dropping to the lowest in 18 months in December. Wall Street indexes had sold off sharply on Thursday after revised data had ind...

Alison McNeely of Bloomberg news reports private equity's tough year is showing no signs of letting up: Private equity titans including KKR & Co. and Thoma Bravo pursued unorthodox paths to dealmaking this year in response to a challenging environment likely to persist in 2023.  Firms sold stakes in their portfolio companies, took on private debt, offered preferred equity and plunked down billions in cash to make deals happen as leverage became scarce.   After a red-hot 2021, private equity funds raised $404.6 billion of capital during the first nine months of 2022, a decline of more than 20% from a year earlier, according to Preqin. Deal volume as of Sept. 30 was only a third the record $404.4 billion for all of last year. Private equity boomed in 2020 and 2021 after Covid-spurred volatility in financial markets gave way to government stimulus that sent asset prices soaring. That rally reversed starting this year as inflation and higher interest rates thwarte...

Gavin Benjamin, a partner of retirement solutions at LifeWorks Inc., wrote a comment for Benefits Canada on whether Canada needs a pension champion: In the Expert Commission on Pensions’ 2008 review of Ontario’s pension system, it recommended an agency or unit of the provincial government serve as a pension champion. According to the commission, the pension champion’s responsibilities would include working closely with stakeholders, promoting and facilitating innovation in the pension system and leading policy development efforts in the pension field. The concept of a pension champion on a national level is pertinent, in light of some recent developments that appear contradictory from a pension policy perspective: Funding reform In recent years, several provinces have implemented private sector pension funding reform with the objective of increasing the sustainability of defined benefit pension plans by either making solvency funding requirements less onerous or completely...

I recently had a chance to catch up with Nathalie Palladitcheff, CEO of Ivanhoé Cambridge, CDPQ's large real estate subsidiary. Initially, we were supposed to have a Teams meeting but since it is year-end and her schedule was packed with meetings, I proposed to send her a set of questions which she agreed to answer (added emphasis is mine): 1. Hello Nathalie, thank you for agreeing to answer some questions, I really appreciate it. I’d like to begin with some good news. It was recently announced you will serve as Chair of REALPAC for a two-year term starting on January 1, 2023. Can you share with us the purpose of this organization, what will be your role and what is your vision for REALPAC? It has been a pleasure to be part of the REALPAC team for the past few years, as I held the position of Vice Chair over the period of 2021-2022. I look forward to working more closely with Michael Brooks and his team, and of course, all the other board members. In the last 2 years, REAL...