The Folly of Negative Interest Rates as Public Policy
With its surprise decision last month, the Bank of Japan (BOJ) has joined the European experiment with negative interest rates. Is this a bold and brilliant policy move or the last gasp of failed policy? Unfortunately, it is the latter. Quantitative easing was always a risky experiment. From the start, it failed the test of intellectual coherence. With three years of experience in Japan, it is failing empirical tests as well. It is unclear whether policymakers have the knowledge, fortitude, and tools to reverse course and unwind this unfortunate experiment.
Annual Cost of Healthcare for a Typical American Family of Four Approaches $25,000
In 2015, the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $24,671 according to the Milliman Medical Index (MMI).1 The amount will almost certainly surpass $25,000 in 2016.
Funded Status of Largest Corporate Pension Plans Drops by $6 Billion in March
The funded status of the 100 largest corporate defined benefit pension plans dropped by $6 billion during March as measured by the Milliman 100 Pension Funding Index (PFI). The deficit increased to $349 billion from $343 billion at the end of February because of the dual effect of a decline in the benchmark corporate bond interest rates used to value pension liabilities and flat asset performance in March. As of March 31, the funded ratio fell to 81%, down from 81.2% at the end of February.
The student loan debt crisis revisited: For-profits come to the forefront
Problems connected with high levels of student loan debt continue to make headlines. Today, the controversy centers around for-profit colleges, which, according to The Wall Street Journal, teach about 11% of higher education students, but whose students account for 44% of defaults on federal loans.