Risky Christie Investments Triggered Pension Shortfall

It's no surprise, but Gov. Chris Christie isn't great with money.

A new report from the International Business Times illustrates how New Jersey officials "directed increasingly large slices of state pension money into riskier investments," often funds run by Christie's cronies. And in the years following, it underperformed the stock market, jeopardizing workers' retirements:

Since Gov. Chris Christie took office, he has nearly tripled the amount of retiree cash invested in alternative investment firms – many of whose employees have made financial contributions to political groups backing Christie's election campaigns. In that time, the gap between New Jersey's alternative portfolio and the broader market has rapidly expanded, costing taxpayers billions in unrealized returns and threatening the financial stability of the $78 billion pension system. The state's pension funding shortfalls – which have been exacerbated by Christie's market-trailing investment strategy – were one of the factors cited by Fitch Ratings in its decision last week to downgrade the state's bond rating for the second time.

The below-market results from the state's $20 billion alternative investment portfolio belie repeated assurances from New Jersey officials who said the investments would overperform the stock market. Instead, the results buttress arguments by investors like Warren Buffett and some local lawmakers, who assert that pension money should be invested in stock index funds rather than hedge funds, private equity, venture capital, real estate and other alternative investments.

Read the full story here.