Moore offers state pension money for bailout
Posted September 25, 2008 5:36 p.m. EDT
Updated September 25, 2008 6:53 p.m. EDT
Raleigh, N.C. — As Congress hammers out details on the proposed $700 billion bailout of the U.S. financial industry, State Treasurer Richard Moore said he is ready to put state pension money into the pot, if needed.
Moore said he would provide some of the pension fund's $75 billion in assets to assist the bailout in exchange for a guaranteed interest rate to ensure the more than 800,000 North Carolinians who count on the fund would benefit from the move.
"I think most people out there would say, 'My gosh, if you give me a guarantee of 8 percent from the federal government,' I think they'd take that right now," Moore said.
Bond holdings are keeping the state pension fund steady amid the rises and falls on the stock market, he said.
"Our values have gone up roughly to offset what's gone down, which makes the case of why you want to have a diversified portfolio," he said.
With an agreement reached by lawmakers on a federal bailout, it's unlikely anyone will take Moore up on his offer. He said his main worry with the federal plan is that taxpayers will be left holding too much of Wall Street's bad debt.
"If there was ever a situation where the devil's in the details, this is it," he said.
Even with a bailout, Moore said, the country's financial system is seriously damaged.
"There is well-grounded fear in the financial system," he said, adding that he doesn't see the national economy improving in the foreseeable future.
Eventually, the culture of rewarding risky credit must change, he said.
"Go to the movies tonight. Go to dinner. Go to Acapulco this weekend. I don't care. But don't do it on your credit card. That's what we've got to stop doing." he said.