You are hereAnnuity News
Annuity News
Retail Investors Moving Money into Bond Funds at Record Pace
Over the past several years, retail investors in the United States have been moving their money into bond funds at a pace not seen in 23 years.
The movement of money into fixed income funds by individual investors has outpaced contributions into equity funds for 30 straight months.
Variable Annuity Sales in U.S. Post Largest Gain in Two Years
U.S. variable annuity sales totaled $35.5 billion in the second quarter of 2010. This represents an 11 percent increase from the same period in 2009, and the gain is the largest since 2007.
Prudential was the leader during the period with $5.3 billion in sales--a significant increase relative to $3.38 billion during the same period the previous year.
Buffett Positioning Berkshire Bond Portfolio in Light of Inflation Concerns
Bloomberg reports that Warrenn Buffett is shortening the duration on Berkshire Hathaway's fixed income holdings.
Twenty one percent of Berkshire's bond holdings are short duration and due in less than one year. This represents a 3 percent increase from eighteen percent on March 31 of this year, and a 5 percent increase relative to the second quarter of 2009.
The Prevalence of Large Negative Returns on Major Asset Classes
It is natural and tempting to assume that the capital market losses that occurred during the recent financial crisis represent a statistical outlier, a perfect storm, a rare, once in a century event—a black swan.
This is not at all the case.
An unsettling and eye-opening table in the current issue of the Financial Analysts Journal is reproduced below.
Deflation Concerns Gaining Traction as Economy Stalls
The consumer price index has fallen for two consecutive months: 0.2 percent in May and 0.1 percent in June.
The unemployment rate in the United States remains at a persistent 9.5 percent, and in July the U.S. shed 131,000 jobs.
Not exactly the type of news that supports a strong recovery or growth story.
Annuity Costs May Increase as a Result of Dodd-Frank Act
The financial system reforms imposed by the Dodd-Frank Act will likely result in a broad range of increases in the cost of financial services products.
Similar to Sarbanes-Oxley, the regulatory costs of the legislation will ultimately be passed along to the buyers of financial services.
MIT Researchers Have Success Treating Alzheimer's in Mice with SIRT1 Gene
Researchers at the Massachusetts Institute of Technology had recent success treating a model version of Alzheimer's disease in mice.
Alzheimer's disease is a neurodegenerative disorder that affects up to 1 in 3 adults who reach the age of 80.
Obama Avoids Senate by Using Recess Appointment to Place Berwick as Head of CMS
President Obama leveraged a recess appointment to place Doctor Donald Berwick as head of the Centers for Medicare and Medicaid Services (CMS).
U.K. Government Considering an End to Compulsory Annuity Purchases
British lawmakers are considering an end to the law that requires many U.K. retirees to purchase an annuity by the time they turn age 75.
As an interim step, the U.K Chancellor modified the current law so that the age for compulsory annuitization is increased to 77 from the current level of 75 years of age.
Aegon Modifying U.S. Variable Annuity Products
The Dutch insurance and financial services giant Aegon appears to be rethinking its U.S. based variable annuity business.
It is reported that Aegon is making a move to apply a macro equity hedge to its in-force variable annuity contracts.
The company is also considering the sale of its life reinsurance business, Transamerica Re.