Britain’s latest lounge game is blaming the country’s booming pension funds. Unstable balance sheets at a number of UK best interests pension managers have caused a minor financial crisis with ripples abroad. The causes of this crisis deserve to be concerned as they can come to a financial instrument near you.
In particular, pensions are increasing because funds are very sensitive to changes in interest rates as they seek to balance assets and liabilities over the long term. And a boom is happening in the UK because defined benefit pension plans – most sensitive to interest rates – are still more popular in the UK than they are in the US. As of 2019, around 35% of Britons applying for a private pension are in a defined benefit scheme. , while the US share has dropped to 23%.
https://www.wsj.com/articles/who-blew-up-britains-pension-funds-financial-panic-u-k-liz-truss-bank-of-england-11665601086 Who Blew Up Britain’s Pension Funds?