The Pension Situation May Hamper Market
Wall Street Journal Online (08/25/02) p.48; Arvedlund, Erin E.

Experts warn that older style, defined benefit pension plans are often being underfunded by companies that overestimate the value of their pension funds. The estimated total underfunded pension liabilities of companies in the Standard & Poor's 500 stock index rose to $111 billion last year, from just $26 billion at the end of 2000. Employees need not worry, because underfunded pension funds are guaranteed by the Pension Benefit Guaranty Corp., but investors should keep the overstatement of assets in pension funds in mind when considering a company's overall market outlook, experts suggest.


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