An article in Barron's proposes using modern monetary theory to solve the issue of underfunded state public pensions. An article by  Randall W. Forsyth in Barron's describes how public sector finances lag, despite recovery in home prices since the recession. State and local pensions have $8.8 trillion of liabilities, of which only 52% is funded after a decadelong bull market. Falling interest rates have been a major propellant of higher asset prices, but also have…

As described in an article in Chief Investment Officer, public pensions and church pensions face similar difficulties and might benefit from similar investment models. A white paper written by Rivera and Mercantile Managing Director Thomas Cassara suggests managing volatility and avoiding drastic underfunding. According to Cassara, an ideal investment strategy for these plans needs to address two key objectives. One is to improve the funded status of the plan while managing the ups and downs…