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Institutional Investor Special Report: The Coming Crash -- A Trillion-Dollar Pension Crisis Looms Large Over America

As the U.S. slowly pulls itself out of recession following the worst financial debacle in more than 70 years, another potential crisis is looming on the horizon. The country's pension system -- both public and private plans -- faces trillions of dollars in unfunded liabilities and has little hope of ever being able to meet them.

In Institutional Investor magazine's March cover story, "Collision Course," Pulitzer Prize-winning journalist Paul Ingrassia and Staff Writer Imogen Rose-Smith take an in-depth look at what General Motors' historic bankruptcy has to teach about the looming pension crisis, while pointing to alarming parallels between GM and cash-strapped California, whose pension crisis may already have arrived.

"Public pensions can be viewed as a liability eating away at a state's financial strength," says Andrew Horrocks, an investment banker at Moelis & Co. who advised the Canadian government on GM's bankruptcy last year. "This is all about promises made that can't be kept without bleeding taxpayers. It's a striking analogue to GM, and it's frightening."

The cover story features a sidebar "Eight Ways to Avoid a Crash," which offers eight practical pension-related recommendations, gleaned from lessons of the GM implosion, that may help cities and states avoid the same fate.

In the special report's second feature, "Road to Ruin," Senior Writer Frances Denmark examines how market losses, growing unemployment and diminished union membership are choking the viability of hundreds of multiemployer plans, the name given to union-sponsored pension plans, also called Taft-Hartley plans. "The events of 2008 shattered the illusion of safety," says Richard Epstein, a law professor at the University of Chicago. "You're looking at a catastrophe in 2020."

Read the special report now at www.iimagazine.com.

For more information, please contact Michael Peltz at 212-224-3152 or mpeltz@iimagazine.com.

About Institutional Investor

Institutional Investor magazine's editorial mission is to serve its professional readership by exploring the relationships among consumers of capital, providers of capital and financial intermediaries; by identifying key financial institutions and personalities; by analyzing, interpreting and explaining market events and trends; and by delivering that information, analysis and interpretation fairly, accurately and in a sophisticated, provocative and entertaining way.