The Israel Deception

Is the return of Israel in the 20th century truly a work of God, or is it a result of a cosmic chess move to deceive the elect by the adversary?

Showing posts with label retirement. Show all posts
Showing posts with label retirement. Show all posts

Saturday, April 1, 2017

Pension bomb climbs to nearly $2 trillion in a decade as Fed and zero interest rates kill Americans chance of retirement

With the Federal Reserve picking winners in their monetary policies since the 2008 financial crisis, the real losers have been the 10's of million of retirees, and the hundreds of millions of Americans who have lost purchasing power thanks to stagnant wages and rising inflation.  And it is directly on the heads of the central bank that the wealth disparity between the 1% and everyone else has taken place.

And because of the massive expansion of credit and debt, and the keeping of interest rates below 1% for over a decade, the nuclear bomb that is America's underfunded retirement scheme is now on the precipice of not only exploding, but also taking down local and state governments with it.

Just how big is the underfunded pension bomb you might ask?  Numbers as of the end of March 2017 now show that the total is just under $2 trillion, and has gone up nearly 10 times since 2007 and just before the financial crash.

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Are millions of Americans about to see the big, juicy pensions that they were counting on to fund their golden years go up in flames in the biggest financial disaster in U.S. history? When Bloomberg published an editorial entitled “Pension Crisis Too Big for Markets to Ignore“, it simply confirmed what a lot of people already knew to be true.  Pension funds all over America are woefully underfunded, and they have been pouring mind boggling amounts of money into very risky investments such as Internet stocks and commercial mortgages.  Just like with subprime mortgages in 2008, this is a crisis that everyone can see coming well in advance, and yet nothing is being done about it. 
On a day to day basis, Americans generally don’t think very much about pensions.  Most of those that have been promised pensions simply have faith that they will be there when they need them. 
Unfortunately, the truth is that pension plans all over the country are severely underfunded, and this has already resulted in local fiascos such as the one that we just witnessed in Dallas
But what happened in Dallas is just the very small tip of a very large iceberg.  According to Bloomberg, unfunded pension obligations on a national basis “have risen to $1.9 trillion from $292 billion since 2007″… 
As was the case with the subprime crisis, the writing appears to be on the wall. And yet calamity has yet to strike. How so? Call it the triumvirate of conspirators - the actuaries, accountants and their accomplices in office. Throw in the law of big numbers, very big numbers, and you get to a disaster in a seemingly permanent state of making. Unfunded pension obligations have risen to $1.9 trillion from $292 billion since 2007. 
And of course that $1.9 trillion number is not actually the real number. 
That same Bloomberg article goes on to admit that if honest math was being used that the real number would actually be closer to 6 trillion dollars… 
So why not just flip the switch and require truth and honesty in public pension math? Too many cities and potentially states would buckle under the weight of more realistic assumed rates of return. By some estimates, unfunded liabilities would triple to upwards of $6 trillion if the prevailing yields on Treasuries were used. That would translate into much steeper funding requirements at a time when budgets are already severely constrained. Pockets of the country would face essential public service budgets being slashed to dangerous levels. -  The Economic Collapse

Tuesday, January 17, 2017

2017 will see the acceleration of baby boomers dumping retirement assets out of market to pay tax liabilities

In 2013 we saw the first of the baby boomer generation reach the magical 70 1/2 age which began a new trend where these retirees will have to start liquidating their tax deferred assets to pay Uncle Sam his due.  And while that first year saw only around $9 billion sold off from 401Ks, IRAs, and other tax deferred accounts, the Law of Compounding will begin to work against the markets in 2017 as an estimated 100,000 will be taking more distributions from their retirements than they will be contributing to them.

Retirement

In aggregate, per the Wall Street JournalBoomers have saved $10 trillion in various tax-deferred saving accounts.  While that sounds like an impressive figure, with 75 million Boomers, it equates to an average of $133,000 per person which, needless to say, is insufficient to fund ~20 years of retirement.  
But while the Boomers, and by extension taxpayers, are facing a harsh future, Wall Street has made a killing in fees off of managing the ever growing balance of retirement accounts as Baby Boomers have come of age.  But that all looks set to change as America's aging population is forced by IRS regulations to take retirement withdrawals once they hit 70 1/2 years of age. 
As illustrated by the chart above, over the past 2 decades Americans have consistently contributed more than they've withdrawn from tax deferred accounts, excluding recessionary periods.  But that all changed in 2013 and 2014 as the first wave of Boomers hit the magical age of 70.5 with a total of $25 billion of net withdrawals in 2014 alone. 
Contributions to tax-deferred retirement plans outnumbered withdrawals through much of the 1990s and 2000s. That flow began to reverse as boomers entered their retirement years earlier this decade. 
Investors pulled a net $9 billion from workplace retirement-savings plans in 2013, according to the Labor Department. In 2014 the withdrawals jumped to net $24.9 billion. Full-year information for 2015 from the Labor Department isn’t yet available, but large mutual-fund companies that manage the bulk of U.S. retirement assets say outflows continue to rise. Fidelity Investments expects 100,000 customers to take their first required distributions in 2017, up from 91,000 in 2016. 
Still, distributions are expected to grow exponentially over the next two decades because of a 1986 change to federal law designed to prevent the loss of tax revenue. Congress said savers who turn 70 ½ have to start taking withdrawals from tax-deferred savings plans or face a penalty. Specifically, retirees who turn 70 ½ have until April of the following calendar year to pull roughly 3.65% from their IRA and 401(k) funds, subject to slight differences in the way the funds are treated by the Internal Revenue Service. - Zerohedge
Yet what makes this trend even more dire for Wall Street is the fact that the younger generations are not buying stocks, or putting the same amount of money as their parents and grandparents into retirement accounts.  And with millennials having so much debt and lower job prospects on the horizon for at least the next decade, there are few buyers to mop up the selling that will be taking place in the markets at the coming exponential rates.

It has reached that time when Paul must pay back Peter for the years baby boomers spent deferring their taxes to save for their retirements, and Uncle Sam will not care how it affects the overall markets in the short and long runs.  And like the fact that Social Security no longer has enough workers paying in to support the benefits being taken out by these same boomer recipients, the retirement programs of 40 and 50 years ago will have to redone for a different world, and where the younger generation will need to rely more upon themselves than in being able to use Wall Street as their retirement vehicle.

Got gold?

Monday, January 9, 2017

To supplement the insolvent trust, Social Security increases the amount of income taxed beginning in 2017

When Social Security was first introduced in 1935, it was sold to the American public as form of retirement insurance that was based similarly to that of private insurance policies.  Ie... you put in a certain amount each pay period and at age 62 or higher, you can begin to collect the proceeds of your 'policy'.

But the reality is that Social Security is little more than a ponzi scheme, and a way for the government to siphon out wealth from its citizens.  In fact, a Supreme Court ruling in the 1960's specifically labeled the program a benefit rather than insurance, and the government has no legal mandate to pay these benefits to individuals who contributed to the program.

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Many people believe that Social Security is an “earned right.” That is, they think that because they have paid Social Security taxes, they are entitled to receive Social Security benefits. The government encourages that belief by referring to Social Security taxes as “contributions,” as in the Federal Insurance Contribution Act. However, in the 1960 case of Fleming v. Nestor, the U.S. Supreme Court ruled that workers have no legally binding contractual rights to their Social Security benefits, and that those benefits can be cut or even eliminated at any time. - Cato Institute
Over time the government has used Social Security as a political carrot, where in the attempt to get re-elected, politicians in 1956 expanded the program to include the disabled and began using monies set aside in the Trust Fund for retirees to pay for it.

Today Social Security is completely bankrupt and insolvent, and if anyone needs proof of this all they have to do is go back to the words of the Secretary of the Treasury Jack Lew who inferred that if Congress didn't pass a new budget and halt a potential government shutdown, then the ability to pay Social Security recipients would be at risk (despite the fact they were still collecting FICA taxes).

Now in 2017, and in a desperate attempt to keep their ponzi scheme going a few more years, Congress is increasing the income level that is taxed by FICA from $118,500 to $127,200.  However, this increase will do little to help the program since the total amount of revenues received from this increase will be minimal.  But what it does is provide the public the illusion that the government is going after the 'rich' to make them pay more, or at least their 'fair share'.

FICA

Prior to the advent of Social Security, people were expected to provide for their own retirements and did so through frugality, sound investment, and reliance upon a currency that would not be devalued much over their lifetimes.  But since none of these things are a part of the American culture today, hundreds of millions of people who barely have $1000 in savings to their name will find it impossible to survive when Social Security finally fails, and all that money they put into the scheme will be for not.

Friday, October 14, 2016

Got gold? Today the new SEC rule goes into effect allowing the government to move your non-invested cash into Treasuries

Back in 2014 the SEC passed a rule that now goes into effect on Oct. 14 where investors and pension funds who do not have their money in a security can summarily have their cash reserves moved into U.S. Treasuries rather than money market funds.

While designating this mechanism to only be used during extreme 'adverse conditions', the fact that the global financial and banking systems are teetering on another 'Lehman Moment' means that the government could co-opt your money at any time, and is a backdoor way into moving your retirement and pension assets into Treasury debt instruments to help fund the government.

Image result for government wants your retirement and pensions
The big day has finally arrived: starting today, as previewed repeatedly over the summer, the SEC's 2a-7 money fund reform adopted in 2014 officially require many prime money market mutual funds (those that invest in non-government issued assets such as short-term corporate and municipal debt) to float their net asset value. More importantly, these prime MMFs are allowed to delay client withdrawals under adverse market conditions. 
The rule aim to prevent the sort of chaos that hit the money market after Lehman Brothers Holdings Inc.’s 2008 bankruptcy, which helped spark the financial crisis. The goal is to give investors a way to monitor a fund’s health by tracking its fluctuating net asset value, and to contain the fallout that could be caused by many investors cashing out at once, the SEC wrote in the final rules. 
As as result, many Prime MMFs are and have been converting their assets to government funds, not buying CDs anymore and moving into Treasurys and agencies. As the chart below shows, nearly $1 trillion in assets have rotated out of prime money markets into government funds, as a result sending Libor rates through the roof, to the highest level since the financial crisis, with consequences that have yet to be determined. - Zerohedge
But this scheme gets even more diabolical as the new SEC rules also allow for the government to DELAY in giving you or your broker the cash funds moved into Treasuries, thus making it so you no longer have control over your own money.
Take the case of Simon Gore, treasurer of budget carrier Spirit Airlines, who has had a relatively simple job over the past several years when he took tens of millions of dollars of company cash and parked it in money-market funds. Gore told the WSJ he has moved money out of some funds and is considering his options for depositing the more than $1 billion of cash and investments on Spirit’s balance sheet. 
Gore had previously put almost all of Spirit’s cash in prime money-market funds. Now, he has shifted most of it to money funds that invest in debt issued by the federal government or agencies such as Fannie Mae and Freddie Mac, which aren’t affected by the new rules. He said the prospect of a floating net asset value - which also means client withdrawals can be delayed - caused him to think twice about prime funds. Besides facing the risk of losing money under the new rules, companies would have to record changes in the value of their cash, creating accounting headaches.
Ever since the 2008 financial crisis the government has been seeking ways to co-opt the nearly $17 trillion in individual retirement, pension, and mutual fund monies, and this, like Barack Obama's MyRA scheme, is just another backdoor way for them to do so.

How much longer can you trust your future to Wall Street or elected officials who have proven themselves to be some of the most fiscally irresponsible entities in history?

Thursday, August 25, 2016

Retiring Baby Boomers could blow America's pension ponzi schemes wide open

There are a myriad of retirement vehicles out there, with some being run by the government and others being decided by the individuals themselves.  But as we enter into uncharted waters now that the Baby Boomer generation is moving into their retirement life phase, a boiling cauldron of doubt is coming onto the scene...

Could the fiscal insolvency of America's retirement system be completely shattered now that the nation's largest generation in history is about to siphon their money from these ponzi schemes?

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The reason I refer to most retirement plans as ponzi schemes is that by their very nature, they require others to put in money so that those who paid in first can receive their benefits.  And of these, at least two are now virtually insolvent while the others rely upon markets to continue to grow from the input of new money into them as well.

1.  Social Security

Initially, social security was a program created to provide basic incomes to individuals who paid into the system during their working years, and would be compensated from a trust that originally was well funded, and was receiving new monies from those people still working.  But over time the government added new recipients beyond retirees to the program such as the disabled and those who lost family bread winners, and of course over time the nearly $3 trillion in surpluses was stolen by legislators and replaced with debt instruments that have to be paid back by an insolvent government.

And as we saw during the government battle to raise the debt ceiling back in 2013, the Treasury Secretary validated that Social Security was insolvent since it needed borrowed money to pay out beneficiaries.
Treasury Secretary Jack Lew warned Thursday that timely payments to Social Security beneficiaries, veterans, active duty military personnel and Medicare providers would be at risk if Congress does not raise the debt ceiling. - CNN Money
2.  Pensions

Already in 2016 two of the nation's largest pension funds, both public and private, have reported that they are so underfunded that beneficiaries will need to take cuts, or in some cases, see their benefits ended altogether.  And this doesn't include most state pension funds that are now an estimated $2 trillion in the hole.
As the nation’s largest public employee pension plan, CalPERS stands out as the most irresponsible for having failed to prevent government pension spiking and for not forcing their government clients to pay for the spikes. But the pension fund’s $277.2 billion of investments leaves a $144.3 billion unfunded debt to cover 1.6 million state employees and retirees’ pensions, according to CalPERS’ October 31, 2013 report. 
California public employees now enjoy the highest benefits of any state in the nation. To pretend to fund this largess, CalPERS has become the worst “outlier” among public pension plans in using creative accounting to blur their grossly underfunded status. This has allowed its government clients to short-check their annual payment for the nation’s most lucrative pension benefits. - Breitbart
3.  Mutual funds, IRA's, and 401K's

As the Baby Boomers begin moving into their 70's over the next 11 years, the majority of them who hold a mutual funds, IRA, or 401K will soon be required to start selling their assets to pay Uncle Sam their tax obligations.  And this will mean a combination of less money being put into equity markets to prop up stocks, and a shift downward as sellers potentially could outnumber buyers... creating a disastrous scenario where the value of their retirements decline as the stocks they hold diminish in value.

4.  Bonds and Annuities

Ever since central banks embarked upon a policy of zero and now negative interest rates, the return on bonds has not even kept up with the rate of inflation.  Meaning that these former interest bearing yield instruments no longer hold a place in one's retirement portfolio.

Both government and private retirement managers have been able to keep their financial schemes going because there were enough workers that were inputting just enough to keep the system from collapsing completely into insolvency.  But now that the largest generation is ready to stop giving, and change course into taking what they rightfully invested during their working lives, the potential of nearly all retirement programs collapsing is each day becoming a very real probability.

Wednesday, July 27, 2016

Got gold? Congress submits bill to force employers to create a new retirement account for workers since social security is now insolvent

Last week, we wrote here about the fact that the annual Social Security Trustees report showed that the retirement fund had a short fall of $6 trillion dollars, and an overall deficit of $32 trillion.  In essence, this means that Social Security is insolvent and will not be able to pay out benefits to anyone within a few year's time.

So with the fact that Congress had kicked the Social Security can down the road for two decades without doing a thing to fix known deficiencies with the program, and has waited until now when the fund has finally bankrupted itself, what can America's legislative body since we have reached the point where The Stuff has Hit the Fan?

How about create a completely NEW retirement fund from scratch, and make employers pay additional taxes on top of FICA to pay for it.

It was only a few weeks ago that I told you about the government’s annual report on Social Security
It was a veritable death sentence for the program. 
The Board of Trustees for Social Security (which includes the US Treasury Secretary) wrote that major parts of the program have already run out of money, and the rest of Social Security will run out of money in the next decade. 
Well, the government has figured out a solution. And it’s genius. 
Two weeks ago a new bill was introduced on the floor of Congress that, just like all the other really dangerous legislation, i.e. USA PATRIOT Act, this bill has a catchy acronym. 
It’s called the SAVE UP Accounts Act, which stands for. . . 
. . . “Secure, Accessible, Valuable, Efficient Universal Pension Accounts Act”. 
In short, SAVE UP mandates certain employers and businesses in the United States, including many small businesses, to start contributing a fixed amount of money per employee into a brand new national retirement fund. 
Based on the contribution requirements and the average wage in the United States (about $50,000 annually), the bill is slapping a 2% wage tax on employers. 
Funny thing, employers are already paying 6.2% to Social Security. 
So an additional 2% tax effectively constitutes a 32% proportional increase. - Sovereign Man
Since employers have already cut many of their worker's hours thanks to Obamacare, and even more over the past six months due to mandatory hikes in minimum wages, what do we think will be the reaction from businesses once this new tax is added to their overhead costs?

And even more, with the nation's largest pension fund (Calpers) admitting to be vastly underfunded, and the largest civilian pension fund (Central States) cutting benefits for all their retirees, isn't it past time that we all took responsibility for our own retirements, and make sure it isn't in paper assets that will be bailed in when the government itself becomes completely insolvent?

Tuesday, July 19, 2016

Got gold? Social security now $32 trillion in the red, with a $6 trillion deficit

Here at the Daily Economist we have written numerous times on the pension shortfalls proliferating municipalities, unions, and state run systems.  But perhaps it is time we look at the most important retirement plan of all, which of course is that of social security.

In the newest 2016 report out by the Social Security Trustees, the fund that already services tens of millions of Americans with a monthly income, and is promised to do the same for hundreds of millions now working in the labor force, is $32 trillion in the red, and in the shorter term has a $6 trillion deficit.

It’s been several weeks since the Social Security Trustees released their 2016 Trustees Report. I’ve been waiting to see if either Donald Trump or Hillary Clinton or anyone in the press core would say a peep about the astounding $6 trillion deficit implied by the Report’s table VI.F1
Not a peep. 
As you may know, I’m running for President as a write-in candidate along with my VP choice, UCLA economist, Edward Leamer. We’ll be on the ballot along with the two party candidates if voters simply write Laurence Kotlikoff for President and Edward Leamer for Vice President on the ballot in the space provided. It’s that simple. 
Ed and I are deeply concerned about our country’s fiscal condition, which is grave to say the least. If we don’t address it, we can kiss our children’s economic futures goodbye. 
I’ll get back to the overall picture, but let me tell the press what they will find if they care to do their job and look at Table VI.F1. They will learn that Social Security, according to the system’s own actuaries, is now $32 trillion in the red! The $32 trillion is the present value difference between all the system’s projected future benefit payments less the sum of a) all its projected future taxes and b) its current almost $3 trillion trust fund. 
We economists call this measure Social Security’s infinite horizon fiscal gap. Last year, the Trustees reported a fiscal gap of $26 trillion. So the system’s fiscal gap grew by $6 trillion over the past year, i.e., Social Security ran a $6 trillion deficit! - Forbes
And sadly, this trend of increasing deficits will only get worse as the Baby Boomers move completely into their receiving years for Social Security, and a large portion of Millennials who would normally be starting their careers are either out of work, or in jobs earning barely over minimum wage. And this dilemma of course is not even close enough to provide the revenues to pay for those who now collecting social security, much less sustain it for their own retirement years.

The 2008 financial crisis was a wake-up call, and had given Americans nearly a decade to find new alternative ways to save for their own retirements, and to not have to rely upon insolvent state and federal systems that are themselves bankrupt.  And one of the only ways that this can be achieved, especially if the government soon decides to massively increase taxes to cover the growing deficits, is to get some money into physical gold, which will both protect your wealth, and allow you little or no counter-party risk from insolvent Wall Street or government retirement schemes.

Friday, July 8, 2016

The window is closing for the chance to make your own decisions on your retirement accounts and to buy gold at affordable prices

Back during the 2008 Credit Crisis, one of the first things they did was to freeze money market accounts in the wake of bank failures and a liquidity collapse.  For most people, the money market arena is a playing field that only their brokers deal with, but it is important to retirees who have 401K's, IRA's, and mutual funds because this is where your money goes when you are temporarily out of stocks, bonds, or other paper assets.

Back on June 30, an interesting announcement was made to one sector of the retirement industry as Paychex, a third party company that provides HR, business, and financial services to thousands of companies, reported that they were no longer using money markets as a conduit for individuals and businesses to hold their cash in between payments made towards a worker's chosen retirement account, and similarly, when a worker/customer moves out of equities and into cash within their accounts.  And in this policy change, where is Paychex now going to move money to store on a temporary basis?

U.S. government bonds.
I received a document from Paychex today which is the administrator of one of my 401K accounts… and they informed me that they are going to move all cash in NON-government ‘Federated CASH Obligation’ money market accounts to ‘Federated Government Obligations‘… 
Since my 401K money is invested in three different precious metals funds this announcement does not affect me, however it will impact many other unsuspecting would-be retirees who falsely believe that their money is “safe” and “liquid” in a money market account. This is the slippery slope into government forcing account holders to invest in government debt (Treasuries), and it’s exactly what we’ve been warning about. As for me, I’m going to roll that particular account over and away from the control of Paychex. - Silver Doctors via SGT Report

The Federal government has been planning to try to confiscate Americans retirement accounts for some time now, and move them directly into U.S. Treasuries similar to what they did to the Social Security Trust Fund.  And this has already taken place in the pensions of Federal employees, which are secured by government debt (Treasuries), and in the Obama created program known as MyRA.

For over a decade, and in particular since the financial system nearly collapsed back in 2008, many in the alternative financial media have been trying to warn people of the coming death of their established retirement system, and the moves being made to cut promised benefits due to the insolvencies now being seen at the Federal and State levels.  And in 2016, where the U.S. Treasury is at its lowest yield in history, and much of the rest of the world languishes in negative interest rates, the window is closing for Americans to be able to make a choice... and that choice is whether to see your retirement accounts liquidated to fund U.S. government debt, or to take the proactive position and move into gold and silver before the price of each becomes unaffordable.

Wednesday, June 29, 2016

Beginning July 1 will start the trillion dollar selloff of stocks for baby boomers over the next 11 years

Besides the consequences of there being more Baby Boomer retirees than workers to fiscally deal with the insolvent social security program, a new monetary crisis is about to hit the markets in just three days time.  That is because on July 1, the oldest of the Baby Boomer generation will turn 70 1/2, and thus forced to start selling off their 401K, IRA, and mutual fund assets to fulfill their obligations to Uncle Sam and the taxman.
Currently there are between $14-15 trillion in non-pension, personal retirement accounts which are held on Wall Street in the forms of stocks, bonds, annuities, reits, and other security assets.  And by law once someone reaches the age of 70.5, they must begin selling off those securities at the rate of 3.65% each year, with a decade later it expanding to 5.35% after age 80, and 11% per annum after age 90.
Since the first of the Baby Boomers will be hitting the age of 70.5 on July 1, selloffs in the market will commence over the next 11 years as those on the lowest end of the generational scale will each move into this age requirement at an accelerated pace year by year.
boomers selloff

Tuesday, June 21, 2016

Japan’s 75 year old finance minister intimates that the elderly should die to aid economy

Perhaps it’s time we add euthanasia to the monetary polices of Keynesian ideologues after the 75 year old Finance Minister for the nation of Japan intimated that all the elderly should keel over and die to aid their insolvent economy.
In a speech given recently to prompt the wealthy in Japan to stop saving their money and instead spend it more, Taro Aso referenced watching a television show which featured a 90 year old woman being fearful of the future, and wondered to himself about ‘how long she intends to keep on living’.

Thursday, June 9, 2016

As the world begins to realize that gold is money, Britain to allow individuals in their pension funds to own gold from Royal Mint

As public and private pensions and retirement funds around the world find themselves in massive shortfalls, with many now unable to keep their promises made to their workers, Britain is finally capitulating to the idea that gold is not only money, but a vital store of wealth in a world of zero interest rates and declining returns.  And on June 9, the Royal Mint announced they are allowing investors and individuals who own pensions and retirement funds to be able to buy physical gold rather than simply paper and equity assets.

This new programs is the result of a law passed in the UK back in 2014 that once again recognized gold as a standard of wealth (money), and it has taken two years and the advent of failed monetary policies by their government and central bank to finally implement the allowance of gold purchases to help shore up their insolvent pension programs.


Investors will be able to buy 100g or 1kg bars and hold them in the Royal Mint's bullion vault storage facility. The vault is located at Llantrisant in South Wales and is guarded by the Ministry of Defense. The most expensive single bar weighing one kilogram can be purchased for £28,286 ($41,131). 
Investors will be charged up to one percent a year (plus VAT) for the privilege of owning the bars, based on the daily market value. 
"The Royal Mint benefits from a centuries-old reputation as a trusted bullion provider and manufacturer of coins on a global scale. The move to make Royal Mint gold bullion available for holding within pension schemes opens us up to a whole new marketplace," said Chris Howard, director of bullion at the Royal Mint. 
While previously it was possible to buy gold bullion from the Royal Mint, customers couldn’t do that as part of their pension savings. 
The move to offer UK pension investors the option to buy gold bars follows the decision in 2014 by the Financial Conduct Authority (FCA) to make gold bullion a standard asset. The FCA’s decision then prohibited financial consultants from advising clients to invest in gold. - Russia Today

Sunday, May 22, 2016

Large insolvent pension fund threatens to cut benefits to zero

Before there was such financial vehicles as social security, pensions, 401K's, IRA's, and mutual funds, people were expected to be responsible for their own retirements and nest eggs.  But with Wall Street using many of these instruments as a way to deceive the public into handing over their money to bankers for upwards of 30-40 years of their working lives, individuals became lax in trusting that corrupt institutions would look out for them and follow through with the preparing for their golden years with security.

The fact of the matter is, the only legal ramification for a corporation, and that includes banks, is their fiduciary responsibilities to their shareholders.  Not to their customers, not to their clients, and not from any moral compass of doing the right thing versus massing as much wealth as possible for themselves.

And sadly, this is also the scenario that has emerged for state, municipal, union, and private pension funds, who for the most part have relieved themselves of their fiduciary responsibilities and given over monies promised to workers to Wall Street fund managers, and even to unscrupulous Hedge Funds in the hopes of expanding pension pools to make up for worker promises they couldn't keep.

And now eight years after zero interest rates destroyed the fixed income markets, not only are states such as Illinois underfunded and virtually insolvent because they put their retirees money in stocks and toxic assets like Mortgage Backed Securities (MBS), now one of the largest private union pension funds is leaving their retired workers with an Ogre's choice (die slowly or die quickly)...

Either have your benefits cuts to virtually nothing, or have the fund go bankrupt within the next 10 years.

The Central States Pension Fund has no new plan to avoid insolvency, fund director Thomas Nyhan said this week. Without government funding, the fund will run out of money in 10 years, he said. At that time, pension benefits for about 407,000 people could be reduced to "virtually nothing," he told workers and retirees in a letter sent Friday. 
In a last-ditch effort, the Central States Pension Plan sought government approval to partially reduce the pensions of 115,000 retirees and the future benefits for 155,000 current workers. 
The proposed cuts were steep, as much as 60% for some, but it wasn't enough. Earlier this month, the Treasury Department rejected the plan because it found that it would not actually head off insolvency. 
The fund could submit a new plan, but decided this week that there's no other way to successfully save the fund and comply with the law. The cuts needed would be too severe. - CNN Money
The bottom line is that 2008 was a warning shot to Americans relying upon pensions and other savings instruments to fund their retirements.  And for those who willingly cashed out when they could despite the penalties, many were able to move that money into tangible wealth protection such as gold, silver, and precious metal based IRA's.  But sadly, the majority of people continue to trust Wall Street, and this week's insolvency for the Central States Pension Fund will only be the beginning of many more collapses to come.

Saturday, May 14, 2016

As Arizona seeks to cut pension benefits, state Governor vetoes bill to recognize gold as money

There are many states in the U.S. who have discovered that a return to a sound money backed by gold may be the only relief for their debt problems that not only threaten local governments, but state-wide pensioners.  And while places like Utah, Texas, and Oklahoma have all passed legislation recognizing gold as legal tender, one Southwestern state is rejecting this premise at a time when pensioners are being asked to accept less retirement proceeds due to massive deficits.

Arizona's Republican establishment Governor Doug Ducey just vetoed the second bill to come across his desk, which was seeking to label gold as both money, and recognized legal tender within the state earlier this week.  And instead Ducey is focusing on a new measure which would cut the rate of payments to retirees under the state's pension facility since normal investments for the program have been unable to keep up with the amount due individuals paid into the scheme.


There is no cure for zero interest rates (and negative in Europe and Japan). The central banks have created a monster, a Frankenstein that is now ravaging the economy and especially those who depend on fixed income. 
It is no longer possible to earn a yield on paper money, without taking undue risk of precisely the sort that retirement funds should not take. 
The only antidote to zero yield on paper is a positive yield on gold. 
I explained to the legislators that this bill would not fix the problem in itself. It is a necessary but not sufficient step. 
I made a different argument to Governor Ducey. Most legislation creates winners and losers. Those who will be hurt by a new law of course lobby against it, and may become enemies of the governor for signing it. This bill created no losers. No one would be hurt by recognizing gold as money. It would have been good for the state, adding jobs, and even tax revenue. 
Unpersuaded by either the plight of the pensioners or the prospect of business growth in Arizona, Ducey vetoed gold.  
This is his second time to shoot down gold. 
I have just two points to make about this. One, let’s stop perpetuating the myth that Republicans—or even pro-business Republicans as Ducey brands himself—are for gold. This is a big reason cited by Democrats for why they are against gold. 
Two, Governor Ducey knew he could get away with this veto because few people care. While our monetary system drowns under zero interest and runaway debt, people are worried about the Kardashians and the gender of Bruce-now-Caitlyn Jenner. - Monetary Metals

Tuesday, April 26, 2016

Average Americans still haven’t returned to the stock market after 2008 collapse

When the stock market crashed in 1929, it took until the 1950’s for the Dow Jones to return to its former all-time high of 24 years earlier.  And it also took until the post-war and post-Depression decade before the average American felt secure enough in the equity markets to begin investing on Wall Street.
Over the past 60 years, both the Federal government, and the brokerage houses made it easier for everyday people to play in the stock markets, until the 2008 crash changed all that when equities declined by over 55%.
Yet unlike the 1987 crash, and the bursting of the Dotcom bubble in 2000, this crash appears to be long lasting as a new gallup poll out shows that only 52% of U.S. adults have ever invested in the markets, and that is the lowest percentage in more than two decades.
InvestInStocks1

Thursday, April 21, 2016

It is getting well past the time to protect your retirement with gold as one of America's largest pension funds to cut benefits

In the aftermath of the 2008 credit crisis and subsequent fall of the stock markets by over 60%, many retirees who had their money in mutual funds, 401K's, and IRA's lost most of their wealth as we headed full on into what would become known as the Great Recession.  And while the Federal Reserve worked extremely hard at propping the equity markets back up to reach new all-time highs over the past seven years, the fragility of America's retirement system grew even greater as the debt bubble underlying it has now reached crisis proportions.

Which brings us to a new tribulation on April 20, and one that will become a domino effect for the majority of pensions across the country as one of the largest pension funds in America announced they are cutting benefits for hundreds of thousands of workers and retirees.


The Central States Pension Fund is currently paying out $3.46 in pension benefits for every $1 it receives from employers, which has resulted in the fund paying out $2 billion more in benefits than it receives in employer contributions each year. 
As a result, Thomas Nyhan, executive director of the Central States Pension Fund said that the fund could become insolvent by 2025 if nothing is done. The fund currently pays out $2.8 billion a year in benefits according to Nyhan, and if the plan becomes insolvent it would overwhelm the Pension Benefit Guaranty Corporation (designed by the government to absorb insolvent plans and continue paying benefits), who at the end of fiscal 2015 only had $1.9 billion in total assets itself. Incidentally as we also pointed out last month, the PBGC projects that they will also be insolvent by 2025 - it appears there is something very foreboding about that particular year. 
As the Washington Post writes
Ava Miller, 64, and her husband, Ed Northrup, 68, could see their combined monthly pension income cut to about $3,000 from the nearly $7,000 they receive now, according to a letter they received from Central States in October.  
If the cuts go through, Miller, who worked as a dispatcher in Flint, Mich., said they will need to dip into their savings to help cover their $1,300 mortgage payment, heating bills and trips to visit her 84-year old mother. 
Northrup, a retired car hauler, has started applying for truck driving jobs that could supplement their potentially smaller pension payments.  
What makes the cuts more painful, Miller said, is that she took pay cuts so that the company could continue making contributions to the pension. "I did everything I was supposed to," Miller said, adding that she and her husband made extra payments on their car loan to cut down on their monthly bills after they received letters in October informing them of the potential cuts. - Zerohedge
There is little the Fed, Congress, or state and local governments can do to resolve the growing problem of underfunded pension systems, and unless individuals take control of their retirement programs, the results will be catastrophic for the tens of millions of Americans about to retire from the Baby Boomer generation.  But there is still a way to protect yourself, your retirement, and your wealth, but time if growing short, and the one asset that can save you is very quickly moving into a position of unaffordability...

Gold.

Monday, April 4, 2016

There is no longer a path to retirement unless you make it happen

Before the U.S. chose to engage in a path of monetary inflation starting in the 1960's, retirement was not a difficult endeavor for most Americans since the cost of goods and services were comparable to the monthly allocation of pension benefits and social security.  However, when these two things began to disconnect a decade later, it became almost a necessity for an individual to start investing early in the markets or in assets that could provide a return feasible to counter price inflation that has been almost non-stop for 50 years.

But with the central bank embarking on a more aggressive policy of monetary expansion to purposely increase the amount of inflation in the economy, it appears that for the American people we have reached a point of no return, and the dream of a comfortable retirement without incredible intervention by the individual themselves is pretty much done.



Graphic courtesy of Jim Quinn, Burning Platform
In fact, the number of full-time workers over the age of 55 numbered only 11 million in 2000, representing 18.6% of the over 55 population. Today, over 21 million full-time employed over 55 year olds, represent close to 25% of the rapidly growing over 55 year old category. 
Boomers aren’t retiring en mass because they can’t afford to retire. The labor participation rate of the younger generations is being negatively impacted by the non-retirement of Boomers. This is called the trickle down effect from unintended consequences. The establishment has strip mined the wealth of the country, leaving a barren wasteland in its wake, creating a seething populace, seeking perpetrators to blame. The populist uprising which propels Trump and Sanders has been spurred by the destruction of the working middle class as the corporate fascists, global elite, and banking cabal have pushed their game of financialization roulette to its limit. - Burning Platform

Friday, February 19, 2016

Got Karatbars? Pension funds on the brink as Midwestern based one slashes monthly payouts by 50% for 400,000 people

The American dream... where you work for a company or municipality for 30 to 50 years and can retire with the guaranteed promise of a sufficient pension to provide for your golden years.  Unfortunately however, that was last so last century.

Today pension funds in most sectors of industry and public service stand on the brink of insolvency through under-funding by as much as 40%, and this covers pensions managed by unions, private corporations, and municipalities.


Yet who is to blame for this under-funding or mismanagement? Americans can thank none other than Wall Street speculators, corrupt cronyism, and central bank policies for the death of their retirements.

After working 33 years, he’s facing a 55% cut to his pension benefits, a blow which he says will “cripple” his family and imperil the livelihood of his two children, one of whom is in the fourth grade and one of whom is just entering high school.
Dorsey attended a town hall meeting in Kansas City on Tuesday where retirees turned out for a discussion on “massive” pension cuts proposed by the Central States Pension Fund, which covers 400,000 participants, and which will almost certainly go broke within the next decade. 
“A controversial 2014 law allowed the pension to propose [deep] cuts, many of them by half or more, as a way to perhaps save the fund,” The Kansas City Star wrote earlier this week adding that “two much smaller pensions also have sought similar relief under the law, and still more pensions are significantly underfunded.” 
“What’s happening to us is a microcosm of what’s going to happen to the rest of the pensions in the United States,” said Jay Perry, a longtime Teamsters member.
Jay is probably correct. 
Public sector pension funds are grossly underfunded in places like Chicago and Houston, while private sector funds are struggling to deal with rock bottom interest rates, which put pressure on expected returns and thus drive the present value of funds’ liabilities higher. 
Illinois’ pension burden has brought the state to its knees financially speaking and in November, Springfield was forced to miss a $560 million payment to its retirement fund. In the private sector, GM said on Thursday that it will sell 20- and 30-year bonds in order to meet its pension obligations 
"At the end of last year GM's U.S. hourly pension plan was underfunded by $10.4 billion," The New York Times writes. "About $61 billion of the obligations were funded for the plan's roughly 360,000 pensioners." Maybe it's time for tax payers to bail themselves out.  - Zerohedge
We now live in an era where people must take responsibility for their own money, and where trust and reliance upon government, brokers, and retirement planners leads only to broken promises and the potential loss of all you have saved during your years of hard work.  But this is not the end of the world, and thanks to the explosion of the internet and the rise of e-commerce, saving and building a retirement nest egg that is free from market volatility, corrupt fund managers, and central bank policies like zero or negative interest rates is now possible.
And you can do this by not only protecting your retirement, but growing it perpetually with a company called Karatbars.



Buying gold through Karatbars is one of the easiest things on the net.  In fact, the business model of Karatbars is to sell gold in affordable quantities, such as 1, 2.5, and 5 gram increments, and allow customers to get into the metal without having to shell out $1200+ for a single ounce coin.

And as added perks to signing up with Karatbars, as a customer or affiliate, Karatbars is working on a new e-wallet system that functions just like an offshore bank account, and is outside the authority of the banking system.  From there, you can take your fiat currency in any denomination... dollars, euros, yen, etc... and purchase physical gold which can either be delivered directly to you, or stored for free at one of Karatbar's vaults.

Additionally, any gold that you buy can easily be sold back to Karatbars, or any metals dealer, and if with Karatbars it is then exchanged for currency that is uploaded to you through a pre-loaded debit Mastercard which is connected directly to your e-wallet.  And as we know, MasterCard is recognized in nearly every country around the world, and usable in any currency that accepts it.

But perhaps the best feature with Karatbars is their affiliate program, where you can earn money off commissions from getting others to sign up and become a customer or affiliate.  Not only do you receive commissions from their purchasing of physical gold, but you also earn commissions from anyone who buys a commission package, with that money going directly into your debit MasterCard when you have enough units to cycle.

Imagine the ability to earn the money in which to buy your gold savings simply by purchasing a commission affiliate package one time, and then getting others to sign up and do the same thing.

How many businesses or entrepreneurs can build an infinite business with spending less than $400 of their own money?  And there is never a mandatory requirement to buy beyond what you desire, on your own schedule.  And there is nothing to lose, because you're using money (paper dollars) to buy gold (physical money) and in the end you don't lose a thing.


The global financial system, along with dozens of respected economists, are telling us that now is the time for the end of our current form of money, and the beginning of the transition into a new monetary system that is expected to be backed by gold.  And with banks, governments, and even Harvard professors mandating that central banks have no choice but to eliminate cash from usage by the people to stave off collapse, will you wait until it is too late to make a decision on how you will protect your wealth, and be able to function within the coming new monetary system?

To learn more about Karatbars, you can contact the individual who sent you this article, and click on their referral link to open a free account and begin buying, or building your own gold savings or business with the company of the future.

Thursday, February 18, 2016

Canadians are losing confidence in all sectors of their financial system

Consumer spending and affordability of products and services are just one component of a domestic economic system that alone it is not enough to bring a complete lack of confidence to a nation’s financial system.  But when you add in a growing decline in confidence for that nation’s currency, retirement programs, and investing structures, you have the ingredients for a rebellion that leads to collapse.
Hyperinflation has almost always been incorrectly defined as an out of balance expansion of a money supply, but the reality is, hyperinflation is a lack of confidence event, and it arises when consumers or producers are unwilling to accept assets denominated in the rejected currency at any price to purchase goods or services.
And it appears that this lack of confidence event may be occurring right now in Canada.

Friday, November 27, 2015

Collusion and rate rigging by major banks the focal point of a new civil class action lawsuit

With the Department of Justice and U.S. regulators failing to stop fraud and corruption in the banking system following the 2008 Credit Crisis, it provided the banks a free ticket and ‘get out jail free’ card to continue their criminal activities unabated.  This of course led to more than a dozen instances of fraud and collusion in market mechanisms such as Forex, Libor, money laundering, robo-signing, the gold and silver markets, and many more.

But since the ones charged by Congress and the White House to oversee the banking system not only failed in their duties, but in many cases aided in the fraud, it is now up to the investment arm of the Chicago Teacher’s Pension and Retirement Fund to file a class action lawsuit against most of the major U.S. banks for their part in rate rigging and manipulation, and for the losses incurred by the pension fund because of this fraud.


Read more on this article here...

Thursday, September 10, 2015

Got Karatbars? New study by the Social Security Admin shows by next year one component of fund will be broke

It is a given that only those seeking a political or financial agenda can put trust in government inflated economic numbers put out by Washington each week or month.  And while there are a few agencies like the Congressional Budget Office (CBO) or Government Accountability Office (GAO) that are better than most for publishing correct or near correct statistics, most often you will find real problems masked or hidden to keep the public's awareness of just how bad a financial sector within government is to protect politicians from the ire of their constituents.

But in a new report provided by the Social Security Board of Trustees on Sept. 2, the disability portion of the Social Security trust fund will be out of money as early as next year, with receipts unable to keep up with mandated payments for those on the public dole.

The 2015 annual report from the Social Security Board of Trustees shows that the program’s disability component is in immediate trouble. Data from the latest report show that the disability fund will be depleted as soon as next year and unable to pay full benefits to beneficiaries.   
This week’s first chart uses that data to show total income, expenditures, and assets in the Social Security Disability Insurance (DI) trust fund going back to 1980. The chart shows that the trust fund has been operating under deficits since 2009, as shown by the decline in the trust fund (green bars) and ever-growing gap between the payments (red line) and receipts (blue line).   
Those deficits have been financed by redeeming nonmarketable government securities that were accumulated over the years when the program was bringing in more revenue than was being paid out. The government spent the surpluses on other government programs and credited the fund with the securities. But because the securities are nonmarketable, the government had to use general federal revenues to “redeem” them once the DI fund started to run deficits in order to cover the difference. With the illusion of the DI trust fund about to disappear, policymakers have no choice but to finally confront the financial imbalance that actually began years ago. - Mercatus

Graphic courtesy of Mercatus Center, George Mason University

The consequences of using debt to deal with a social contract that governments have with the people will always result in a point where there is no longer enough money to provide for promises made, and inevitably it is the people, not the politicians, who will suffer from the austerity cuts that come after.

And yet before the 1960's, the Great Society, and the emergence of a welfare state that consumes over $1 trillion per year of both taxpayer and borrowed funds, people relied upon their own retirement planning and the concept of family to both protect one's wealth, and be assured of a future outside of their working years.  And with so many alternative (and quite often rejected) economists and financiers telling Americans to find ways outside the system to grow your retirement and wealth protection, it is now almost too late to suddenly shift gears from a government reliant benefit system to one where you control your own future, and are protected from whatever may come.

But there is a solution, and a way to not only protect your wealth now, but grow it to where you can get sustainable income no matter what age, and in the most reliable form of money in history.

That solution lies in Karatbars




Buying gold through Karatbars is one of the easiest things on the net.  In fact, the business model of Karatbars is to sell gold in affordable quantities, such as 1, 2.5, and 5 gram increments, and allow customers to get into the metal without having to shell out $1200+ for a single ounce coin.

And as added perks to signing up with Karatbars, as a customer or affiliate, you can have the power to move your money into a free e-wallet that functions just like an offshore bank account, and is outside the authority of the banking system.  From there, you can take your fiat currency in any denomination... dollars, euros, yen, etc... and purchase physical gold which can either be delivered directly to you, or stored for free at one of Karatbar's vaults.

Additionally, any gold that you buy can easily be sold back to Karatbars, or any metals dealer, and if with Karatbars it is then exchanged for currency that is uploaded to you through a pre-loaded debit Mastercard which is connected directly to your e-wallet.  And as we know, MasterCard is recognized in nearly every country around the world, and usable in any currency that accepts it.

But perhaps the best feature with Karatbars is their affiliate program, where you can earn money off commissions from getting others to sign up and become a customer or affiliate.  Not only do you receive commissions from their purchasing of physical gold, but you also earn commissions from anyone who buys a commission package, with that money going directly into your debit MasterCard when you have enough units to cycle.

Imagine the ability to earn the money in which to buy your gold savings simply by purchasing a commission affiliate package one time, and then getting others to sign up and do the same thing.

How many businesses or entrepreneurs can build an infinite business with spending less than $400 of their own money?  And there is never a mandatory requirement to buy beyond what you desire, on your own schedule.  And there is nothing to lose, because you're using money (paper dollars) to buy gold (physical money) and in the end you don't lose a thing.



The global financial system, along with dozens of respected economists, are telling us that now is the time for the end of our current form of money, and the beginning of the transition into a new monetary system that is expected to be backed by gold.  And with banks, governments, and even Harvard professors mandating that central banks have no choice but to eliminate cash from usage by the people to stave off collapse, will you wait until it is too late to make a decision on how you will protect your wealth, and be able to function within the coming new monetary system?

To learn more about Karatbars, you can contact the individual who sent you this article, and click on their referral link to open a free account and begin buying, or building your own gold savings or business with the company of the future.