Abstract
The 1990s represented a bountiful period for the nation?s pension funds, with soaring stock prices, low interest rates, and benign inflation. This article examines the major trends during this period for the 200 largest defined-benefit pension funds. Among the trends are tremendous asset growth, fundamental changes in asset allocation, and the growth of internal equities and indexed funds. Public pension funds grew faster than corporate funds, and internally managed assets fell from 42% to less than 33% of the total base. The current decade should be different, given an uncertain stock market as well as the upside risk of inflation and interest rates. The most significant near-term issue will be substantial cash inflows needed to fund both state and corporate pension funds.
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