The assumption of 6-7% risk with low risk is not realistic and the pension system will have to adjust. I don’t think this concern has any mechanism of actually affecting the rates.
As the United States has current account deficit, i.e. relies on foreign investment to fund its debt, lower rates are beneficial for the nation as whole.
CIO, HonTe Investments. Ran global macro at JPM. Yahoo! Finance Contributor. Ph.D. in Mathematics. Author, The Next Perfect Trade. No investment advice.
