Earnings slowdown expected to propel a movement away from heavy borrowing.
Indexes now make up a bit more than one-third of funds, but will reach 50% in two years, the agency says.
Baa–rated issues reach record, although defaults at this stage are not worrisome, Moody’s data indicates.
Ratings agency doesn’t downgrade the state but puts it on ‘credit negative’ status, which could portend trouble ahead.
However, Moody’s says strong 2017, 2018 returns will lead to a drop in liabilities.
Credit rating agencies say fixes for the severely underfunded retirement system don’t go far enough.
Leverage of six largest funds in country has risen to 24% from 19% in 2009.
Illinois, Alaska, and Connecticut among largest unfunded liabilities.
Report indicates while the law is a step in the right direction, lottery floor covers 25% of state pension’s ARC.