The UK pension fund 'doom loop': what does the liquidity crunch mean for the industry?

When UK pension funds holding £1 trillion ($1.15 trillion) in assets this month became stuck in a 'doom loop' of selling government bonds, known as 'gilts',  to meet cash calls on leveraged bets, there was a lot for the pension industry to worry about. The issue revealed systemic problems in the way pension funds hedge interest rate risk, but could the same liquidity crisis that hit the UK funds happen elsewhere? "The financial markets didn’t like the idea of the unprecedented t…