How bad is California's Public Employees Retirement Fund?

Daniel Borenstein has a great article here that should be clear to everyone. He explains how the severe problems are being hidden.

The return rates also affect assessments of the current health of the pension systems. If they're counting on greater investment returns, the pension systems don't need as many assets now. Using a 7.75 percent investment forecast, CalPERS, as of June 30, had only about 74 percent of the funds it should have had, Nation calculated. But assuming a 6.2 percent annual return means the system had only 58 percent of funds it should have had.
Here's another way of thinking about it: Assuming future annual returns of 7.75 percent, the three pension systems combined were short $143 billion, or $11,703 for each California household. At a more realistic 6.2 percent investment assumption, they're short $291 billion, or $23,852 per household. Thus, the higher assumptions hide the magnitude of the problem.
We can insist on properly funding the systems now. Or we can keep hoping we'll win this risky gamble on the markets -- and we'll keep piling up more debt when we lose. . . .