Is America going to get sucked down the sink hole

Discussion in 'Off Topic' started by Fabian, Mar 11, 2010.

  1. Fabian

    Fabian Well-Known Member

    I hope American politicians have a plan - you know, like the A-Team - those guys always had a plan, but does Barack Obama have what it takes to be Sgt B.A. Baracus (aka Mr-T), and is he prepared to use his rocket launchers without prior approval of th U.N.

    It seems the only thing that can save America is for the A-Team to be running Capital Hill and having Hulk Hogan installed in place of Hillary Clinton as Secretary of State - i'm sure negotiations with Mahmoud Ahmadinejad would be a ringside event not to be missed.

    March 11, 2010

    America’s massive flock of baby boomers are unprepared for a very unhappy retirement. By Robert Morley

    A demographic stampede is about to pulverize American society. Eighty million retirees—the baby boom generation—are rapidly heading into their retirement years. And according to a survey released on Tuesday, Americans have less money than ever.

    “People just don’t want to think about this.” Instead, everyone prefers to stick their head in the sand until it is too late to do anything, says Jack VanDerhei, research director for the Employee Benefit Research Institute (ebri).

    According to VanDerhei, the percentage of American workers with virtually no retirement savings grew for the third straight year. Of the over 1,000 workers and retirees surveyed who were over the age of 25, a whopping 27 percent said they had less than $1,000 in savings. That’s up by over 7 percent from last year.

    The percentage of workers who said they have less than $10,000 in savings (the equivalent of 3 months’ worth of average yearly salary) jumped to 43 percent, up 4 percent from 2009.

    The great American recession is already taking its toll, despite still being in its early stages.

    On average, U.S. consumers are going $300 in the hole per month after all expenses are met, says John Lekas, senior portfolio manager for Leader Short-Term Bond Fund. And Lekas says conditions are only going to get worse, as real unemployment (as measured by the government U6 number) heads toward 25 percent over the next couple of years.

    For many families, conditions would already have been much worse had governments not borrowed billions to pay out extended unemployment benefits, food stamps and other welfare.

    It is no wonder that the ebri report found that only 16 percent of respondents were confident in their ability to save enough for retirement. The finding was the second lowest in 20 years and is especially ominous because many of these workers are probably expecting to rely heavily upon Social Security and Medicare benefits—two massive and currently unfunded government liabilities. Social Security is already bankrupt (the government is borrowing money to make payments) and Medicare is projected to have a $38 trillion deficit over the course of the baby boom generation.

    The nation’s retirement safety net is looking more precarious than ever. But with national health care, the wars in Afghanistan and Iraq, Iran seeking nuclear weapons, pirates preying on American shipping, and jobs being offshored to Asia, don’t expect much political action.

    It is far easier for politicians to bury their heads in the sand.

    Even among those who recognize the debt problem facing America, the desperation is akin to chickens running around with their heads cut off.

    Public pension plans are facing a massive crisis too, the New York Times reports. All across the country, state and local pension plans are chronically underfunded. Governments have promised big, but put aside little.

    Instead of admitting they had been lying to their workers (basing predictions on ridiculously high estimates of future investment returns), and telling voters that they need to start paying higher taxes to fund civil servant retirement plans, states and other government bodies are trying to get back into the money by heading to the casino.

    The Times reveals that most government pension plans have based their pension plan funding on the assumption that stocks will return an astounding 9.5 percent yearly growth on average, and that bonds will pay about 5.75 percent. Both suppositions have been shown to be ridiculously high. Even considering the current stock market rally, the Dow Jones Industrial Average is still below levels seen 10 years ago. The Nasdaq is much further underwater. As for government bonds, even the longest dated ones pay only 4.68 percent. A one-year bond pays only 0.37 percent.

    “In effect, they’re going to Las Vegas,” says Frederick E. Rowe, a Dallas investor and the former chairman of the Texas Pension Review Board. “Double up to catch up.”

    Commodity futures, junk bonds, foreign stocks, mortgage-backed securities, leveraged investing, credit default swaps, exotic derivatives—are now all on the table for many desperate pension funds. But as any casino patron knows, for every winner, there are many losers. Vegas only exists because it is successful at separating gamblers from their money.

    It is time Americans pull their heads out of the sand. The current relatively light economic crisis is only the beginning. A stampede is headed this direction, and when the money is gone, many are going to get trampled.
    Last edited: Mar 11, 2010

  2. give me vtec

    give me vtec Active Member

    sounds about right to me... baby boomers are working longer and retiring later. That reality is felt especially hard by people like me that are just graduating from college with the expectations for a $60k + job, but in reality we are lucky to get a $20k job.... because that 60k position is still held by a guy who isnt going to retire because his 401k is down 50%.

    If you are making more than 6% annually on your stocks and 3% annually on your bonds you are looking good.

    The comparison to vegas is dead on...what do you expect. 30 years ago nobody wanted to work for the government... how do you think they changed that??? By promising the sky to the unions...
  3. Fabian

    Fabian Well-Known Member

    There is something else that's not mentioned in the report, and it has stupendously high operating costs - the American military industrial complex.

    Far more money has been diverted out of the economy to fund the technical edge that America requires to stay ahead of the rest of the world and even more serious is the cost of technology duplication as there are so many secret service agencies not sharing technological advances within the intelligence community.
    It's also another case of "Moore's Law" when it comes to funding requirements for the military, be it public face fighting senseless wars, in some cases it's simply a case of welfare checks being paid out to the technical guys to keep them in their jobs and keep their skills up to date, developing technology that's either outdated for the current political climate or simply not necessary for new and emerging threats.

    All that development has a huge and over burdening cost on the American economy and tax payer.
    I remember when the USS Enterprise visited Australia - it was mentioned that the cost for the ship to be sitting in port, just floating about and doing nothing at all was $250,000 per day and the daily sea going costs were terrifying.
    That's just one ship - my understanding is that the 7th fleet has more than one ship.

    When the money no longer flows to the Pentagon, what type of stick will the military use to keep it No 1 in the world as the global policeman.
    This has parallels with ancient Rome - it failed internally, then militarily and then it was finished.

    All i can say is that the Next 20 years are going to be a turbulent time in mans history.

    America is a great country but sadly it currently has 535 people who are taking 300,000,000 down the sink hole, and it need not be so.
    Although Australia is on the opposite side of the world to the U.S. we are closely linked through a global alliance, and what affects America also affects Australia; it may come as a tsunami without warning.

  4. P/C Geek

    P/C Geek New Member

    I come to this forum for motor bike info.Please go elsewhere for for this subject! Don't bum us out with this!
  5. Fabian

    Fabian Well-Known Member

    The post is from 2010, and placed in the off-topic section i.e. the non-motorised bicycle area of this forum.
    It's now 2016, and the post is still as relevant now, as it was in 2010.
  6. KCvale

    KCvale Motorized Bicycle Vendor

    L0ok at the last post date, 2010...
    You just revived a 6 year dead topic by posting in it to say not to do it.
  7. P/C Geek

    P/C Geek New Member

    Well I am new to this site and had not realized it was that old. Still, this is for motor bikes right? I happened to be 4 years retired and barely getting by.But I come here for escape. So WTF?
  8. P/C Geek

    P/C Geek New Member

    Anyway, very sorry I responded to this.
  9. butre

    butre Well-Known Member

    this is the off-topic section, it's meant for any content that isn't related to motorbikes.