Three Big Piles of Retirement Money That Were "Just Sitting There"

Here in the US, in the last several decades, we have had at least three different instances of where people had huge amounts of money--hundreds of millions and maybe billions---of dollars sitting around. And people being people and business being business, they saw it sitting there and it just killed them. They knew SOMETHING had to be done with it, would be done with it and by gosh, they could get a piece or chunk of it and who would that hurt, after all?

Well, the fact is, it hurt Americans and soon, with all the Baby Boomers about to retire, it's going to hurt America. And it's going to hurt mightily.

Here are three of the most famous pots of money.

Social Security

This is an old story and well-known.

We had all these people, Americans, many of them the biggest generation to ever come along in our nation's history, contributing to this Social Security fund since FDR got it going and what could Congress do but take and spend it? After all, there's more where that came from, right?

Social Security Scam: Where Did the 

$2.5 Trillion Surplus Go?

One Senator, now deceased, God rest his soul, Senator Patrick Moynihan, made a very public, long term attempt at being wise with the fund.  Unfortunately, even before he passed, it died, also.

Heed Senator's Call To Keep Social Security 

Soundless Intact

But rob it they did.  It is a shadow of its former self.

This example is much more recent, however. This goes back to the budget deal this last Fall, in 2015 so they're still robbing that puppy:

Budget Deal Robs $150 Billion 

from Social Security

So the robbing of and from the Social Security fund is still going on, unabated and I don't think most Americans are even aware.

Next up? The 2nd big pile of money that was sitting around?

Pensions.

And actually, it's piles. There were pensions all over this country---public, private, all kinds. And it was just far too tempting to too many people.

Millions of Americans had pensions. They had been funded mostly by business and by the people themselves, contributing to them through their work, their companies.  Once again, it was just far too much temptation for people and businesses to ignore.

Looting the Pension Funds

The Looting of Detroit's Pensions

LIKE CLOCKWORK: Pension plans 

to be looted nationwide

There was all that money sitting there and there was no way these people and businesses could let it sit there and not be skimmed.

Again, what could it hurt, right? There was SO MUCH MONEY.  And it wasn't illegal?  Why not, eh?

And then there's the final big pile of money that was heretofore sitting out there, just waiting to be raided.

Mutual Funds

So people saved for retirement. They squirreled their money away, saving for that retirement "rainy day."

And it created, again, huge piles of money. HUGE.  And all kinds of insurance companies and investment companies had these things. It was supposed to be terrific.

Except with the companies who created them "guarding them", protecting them, holding them for these Americans---their customers---it was the fox being in charge of the chicken coop, so to speak.

The Retirement Savings Drain: Hidden 

& Excessive Costs

Vanguard is quietly draining billions 

from the financial industry

Mutual Fund Fees Will Drain Your Expected Stock Returns

Who's to say what the fees and charges for holding and protecting and investing these funds were going to be?

Why the very companies taking in all the big money, of course.

These 3 are really untold tales of just what has happened in America in the last 50 years or so to retirement savings. Government had no rules, really, for what could or could not be done to or with them so who's to say what could or would happen to them?

And the answer is, in the place of Social Security, Congress was to say---they spent it.

And in the case of pensions, both private and public, and mutual funds, again, no rules so whoever is in control of them could do whatever with them they wanted. After all, with "campaign contributions", they could keep the regulators--read: Congress---from passing any legislation that would put any restraints on them. And to this day there are no real rules on what can and can't, should or shouldn't be done with people's hard-earned and saved retirement funds.

It's great to be rich, isn't it?

So now, all these millions of Baby Boomers are going to retire and they're going to be sitting on and falling back on either not much or nothing at all.

This was decidedly not how this was supposed to play out and it's certainly not good for either these people or, worst, the nation and our nation's short-term future.

God bless America.

In fact, God help us.

Goldman Sachs: Getting away with grand larceny, lies and lying about it all

It's been widely reported now that Goldman Sachs is, indeed and in fact, getting away with theft--large scale theft, at that:

Goldman Sachs Won't Be Prosecuted In Fraud Probe

A Senate panel found last year that Goldman Sachs marketed four sets of complex mortgage securities to banks and other investors, but failed to tell clients the securities were very risky. The Justice Department said the "burden of proof to bring a criminal case" could not be met.

And while this should surprise no one, however much it dissappoints us, the following has to be acknowleded:

First, Goldman Sachs is in the White House and has been for some years. Timothy Geithner, the Treasury Secretary, comes from there as former CEO, no less, in one of the worst examples and there are plenty of others.

Second, it's an election year and this president--and all candidates for that office--want and need the big Wall Street firms on their side, if not also putting money in their campaign coffers. It seems clear nothing was going to happen here, no matter what the SEC found.

That said, perhaps the people examining this huge firm should go back and read even just some of writer Matt Taibbi's articles and columns over at Rolling Stone. It seems there's enough evidence in them alone to indict the company in general and specific employees of the firm. (See links below).

Forget that Goldman Sachs paid a $550 million fine (that's a little over one-half billion dollars, folks) to the SEC in 2010 for fraud in the subprime mortgage debacle. Forget that. That doesn't really mean they're guilty, right?

As if this all isn't enough to make you cynical, get this, from the New York Times: "News of the settlement sent Goldman’s shares 5 percent higher in after-hours trading, adding far more to the firm’s market value than the amount it will have to pay in the settlement."

So not only did Goldman steal millions of dollars from people and not only did they then also lie about it but when their fine of $550 million dollars was handed out, since it was such a small share of the $13.35 billion profits they made the previous year, their stock actually went up on that news.

They won.

They won big and they keep winning.

Why wouldn't you keep winning when, after all, you virtually--if not actually--own the government?

We have to also forget that the financial collapse that Goldman Sachs and Countrywide Mortgage and Citibank (or Sh*ttybank, as Bill Maher refers to them, rather appropriately) and others nearly brought the nation--and the world, actually--to very near total financial collapse back in 2008 with their lies and theft. Forget that.

The government says we don't have enough to prosecute.

Right.

Got it.

Links: http://www.npr.org/2012/08/10/158547458/business-news

http://en.wikipedia.org/wiki/Timothy_Geithner

http://www.rollingstone.com/politics/news/the-people-vs-goldman-sachs-20110511

http://www.nytimes.com/2010/07/16/business/16goldman.html

http://www.rollingstone.com/politics/news/the-great-american-bubble-machine-20100405

Big, big questions for 2012

They are big, indeed, the questions we can pose now, for this coming new year. So many people are predicting collapses of different kinds. So here goes, some of my questions for 2012: 1) Will Greece's economy collapse? 2) Will Italy follow suit? 3) Spain? 4) Portugal? 5) Will the Euro collapse, in full or part? 6) Will the US financial system face the same or very similar collapse as we did in 2008, yet again? 7) Seriously, many people I've spoken to--friends--have predicted and are predicting--gulp--the collapse of the US. Nice thought, huh? Understand, I'm not predicting any of the above. I've just seen many people predicting these things. Consider it just food for thought. Think happy thoughts, y'all. And happy new year.

Notice it's the guy with the money

Now the NBA: It's the rich and fatcats against the poor slobs again

First it was Wall Street, screwing us all with their bad mortgage loans they created but sold as AAA rated material. We all know what that got us--the 2008 financial collapse that went worldwide. Then, on a far smaller scale, it was the NFL owners, trying to grab yet more money for themselves, from the players. Fortunately that got worked out. Now? The NBA owners--rich as they are--just don't feel they have or get enough so they're putting another infamous squeeze on their players so the schedule for this year has been put back at least a week. Forget that in both the NFL and NBA--all sports, really, of course--the players are only able to play for a few years, make what they can and then get out. Of course, they also have to hope, especially in professional football, that their health isn't wrecked. The owners? They're there ad infinitum--nearly forever, raking in millions and millions of dollars annually yet these greedheads think they need yet more money. Is it any wonder the "little guy", the "person on the street", the working people of America are finally fighting back, since our wages have been falling for more than a decade? We're fighting for our lives while the wealthy and uber-wealthy are just fighting--us--for yet more millions for themselves. Links: http://www.npr.org/blogs/thetwo-way/2011/07/25/138671825/reports-nfl-owners-players-agree-to-new-deal-ending-lockout; http://sports.yahoo.com/nba/news?slug=ycn-10181629

Uh-oh--this isn't going anywhere good

It seems leaders in China just keep pushing and pushing for change when it comes to the monetary system of the world, specifically as the US' dollar is the basis for the rest of the world:

China economist blasts dollar dominance on eve of G20

BEIJING (Reuters) – Dollar dominance is sowing the seeds of financial turmoil, and the solution is to promote new reserve currencies, a Chinese government economist said in a paper published on the eve of a G20 meeting about how to reform the global monetary system.

Let there be no doubt, if this goes their way, the Chinese' way, it won't be pretty for us, ladies and gentlemen.


And after that last financial/economic debacle we caused that went global, what with the creation and then selling of what were supposed to be AAA grade securities that ended up being junk and then, on top of that, not punishing anyone for it or fundamentally changing virtually anything in our system so we're sure it never happens again, you can't too much blame 'em, can you?


I hope this party doesn't end while I'm at it.

Link to original story:  http://news.yahoo.com/s/nm/us_china_g20_dollar

What should happen

Secretary of the Treasury Timothy Geithner is to go before Congress today, to say what the Administration would like to have happen for and to our financial system, so we can avoid the kinds of problems we have now, in the future.

Following is a short list of what he should be asking and pressing for, at minimum:

1) The outlawing of hedge funds since they just put bets upon bets and run up stock markets artificially;

2) The outlawing of short selling, for the same reasons as above;

3) The making illegal of "credit swaps" since they're a ridiculous lie of a term--a sham, really--meant to be a replacement for actual insurance and all their necessary financial supports;

4) The inability for corporations to buy too many competitors, so they don't become a threat to our country and financial system, the way AIG did and get to be "too big to fail". We knew this from the Great Depression but we let it happen anyway. Hey, what was Congress supposed to do, walk away from lobbyist's money and do the right thing for the country?

These are four easy, intelligent, simple things that should absolutely happen to both help clean up our current mess and to avoid similar problems to our current ones, now.

Sadly, again, ridiculously and even irresponsibly, it won't happen.

Congress hasn't the backbone to do any of this and lobbyists and corporations are too far into our representative's collective financial pockets to do these, right things. There will be huffing and puffing but in the end, what really needs to happen, won't.

Link to story on today's testimony:
http://news.yahoo.com/s/ap/20090326/ap_on_go_ca_st_pe/financial_regulation

A new consensus?

Word out Friday was that the Chinese don't want the Americans blowing all that big money on bailouts, for the very real fear that it could and would devalue the dollar, thereby devaluing Chinese investments.

Hmmm.

This sounds strangely familiar.

If you put this rather big news, coming from Chinese leader Wen Jiabao, together with the fact that, lately, some banks are saying "no thank you" to the Feds for that same bailout money, wouldn't it seem like we have a bit of a consensus here?

Mind you, it's only 3 banks (out of 487) but maybe more banks will get some courage up and either want to return it or out-and-out do so.

Citigroup and GM said they need no more money from the Feds right now, too.

Anyway, it's interesting, at least, that these completely different organizations in totally different physical and structural locations come to the same conclusion.

This could possibly mean that our response has been one of desperation and panic and that maybe this isn't the way to go.

Stay tuned.

It's as I've said, since we're in totally new territory, financially, it's hard to tell where we are.

Unfortunately, it's like a recession--we'll find out after we're already long since there.


Links to original stories:
http://news.yahoo.com/s/ap/20090313/ap_on_bi_ge/as_china_us_economy
http://www.propublica.org/article/third-bank-says-it-will-return-bailout-funds-but-487-banks-keep-theirs-311

An update

An update to Tuesday's (March 10) entry:

There's a story out right now on Yahoo! News from a Time Magazine article saying much the same thing.

See story here:
http://news.yahoo.com/s/time/20090312/us_time/08599188463000

People are asking the same thing--Is the President trying to do too many other, less important things right now, rather than focusing on fixing the financial mess we're in?

He seems to think not.

Some of us think he is.

We hope we're wrong, of course.

We want and need this thing attended to--and fixed.

Things we need to do

The economy's a mess.

The world economy is in the same shape.

We're a mess--and in a mess.

So what to do?

What should be done so we clean up this mess, first, and make sure it doesn't happen again?

Here are but a few of the most important ones:

1) REGULATE BUSINESS. (notice all caps, boys and girls). We need to regulate business, period--especially Big Business.

Whether they're banks or oil companies or energy markets or stock markets, what have you. For the last 8 years, no one's been at the governmental, regulatory switch, so to speak, and we absolutely need them there.

We have to keep greedy people from acting on they're desires and greed. Regulating business is how you do that.

2) Make Hedge Funds illegal. They used to be. They should still be illegal. They are "bets on bets". They were unregulated, again, for the past 8 years on top of being just sheerly stupid. They shouldn't even be allowed. Do away with Hedge Funds.

3) Make "short selling" of stocks illegal. This, too, is a "bet on a bet." Short selling is betting, literally, on a stock's rise or fall. A stock, ladies and gentlemen, is, basically, a bet that a stock's value is going to rise. To allow this short selling is to allow a bet (that the stock will rise or fall) on a bet (the stock itself).

It's stupid. It's irresponsible. It shouldn't be allowed.

It makes for wide and wild swings in the market that are dangerous to our economy and country.

Right this moment, the SEC has made short selling on 19 specific stocks illegal so it's clear we can do this.

We can do this. We should do this.

Stop "short-selling."

4) Regulate the energy markets.

I've written about this before.

For 78 years, up until the year 2000, we regulated the energy markets.

Then we stopped.

Since that time, our energy markets and costs have gone crazy wild. That should be enough indication right there of what we should do.

The energy that runs a country is far too important to be exposed to the greed and selfishness of Big Business, speculators and deregulation.

Even if you could disregard that people's lives are at stake--irresponsible enough, I know--then we have to take into consideration business own existence. Business can't afford the wild swings up and up that we've experienced in the last 7 years.

No, regulate the energy markets. Regulate them completely and responsibly, for everyone's concern--the individual and business.

And do it as soon as possible.

(While we're at it, Congress, why don't you look into that GM "Impact" automobile that ran 120 miles on a charge of electricity? For readers, see "Who Killed the Electric Car"--the movie. Very informative, if disheartening).

5) Take profit out of health care in the United States.

Granted, this will not happen for a long, long time--if ever--but this is what we need to do.

It's antithetical to our society and culture and that's too bad but we need to do this just as we need to do no. 4, above (regulate the energy markets).

We want and need people to be healthy, of course, not the least of which to work in our society, right? But if someone should get sick (and we all do, at one time or another, right?), we throw them to financial dogs, by letting our worship of the rich and wealthy and profits and big business instead of making health care available for all, LIKE THE REST OF THE WORLD DOES).

6) We need to, as a country, stop worshiping wealth, the wealthy, business, Big Business and profit.

We really do, you know, worship wealth and the wealthy, just as we worship "things".

Can we all just accept that this is not, any longer, a good idea?

We need to fuel our society on something beyond products and items.

How many Ipods are we going to buy, for God's sake? (How many versions of that little bastard are they going to keep remaking?)

Think about it, folks. It's blind consumerism that's gotten us into this mess, in a large part.

We HAVE to stop just buying and buying and buying.

The United States has SO MUCH more retail space than any other country on the planet.

All of us--the United States and all the countries in the world--need to get off this product-driven, production-crazed treadmill. China's environment, and so, their society, will benefit from it, too. (No more melamine- or lead-laced products, for starters).


So there you are. Six easy and, I think, obvious things we ought to do for ourselves, for the planet and mankind.

Some of them I do think we'll do and that gives me hope.

Some of them we won't and that's unfortunate.

Some of them we're not even capable of--and honestly, that makes me sad.

More magnificent irony

Yes, more magnificent irony for America, Republicans and, really, the world.

Deregulation of the banking and financial markets was supposed to be this magnificent, brilliant, liberating, stimulating idea for virtually everyone and everything. It was supposed to bring on nothing but good financial times and rising economic futures for everyone--the rich, Wall Street, the poor, the Middle Class, corporations, the little guy, everyone.

Ayn Rand, anyone?

But, lo and behold, the deregulation of the largest economy in the world, the United States, has wreaked havoc on the country and, now we've found out, the world.

The first big irony is that it's been the conservatives, Republicans, fat-cats, corporations and wealthy of the US who thought this deregulation would be not only a good idea but, indeed, a boon to our economy and the world.

There was supposed to be virtually no one this deregulation idea wouldn't benefit.

"Leave the corporations alone and the money will rain down from heaven," seems to have been the idea.

Well, when you leave greedy people alone in a room with money, they'll end up stealing it every time.

So the people hawking these ideas were also supposed to be the free market capitalists, of course. That just makes sense.

The worst thing these people could imagine for ANYONE, anywhere in the world was the evil Socialism or, worst yet, Communism.

The big, final irony now?

All that "free market", deregulation has brought us to the brink of a world bankruptcy with, so far, no end in sight.

Adding to that? (Yeah, we can).

Not only are we going back to regulation, as we ought, with all the countries in the world right now, with economies collapsing (and everyone is, rightfully, it seems, blaming the United States for the cluster mess), we're apparently going to have to join together with all the other world economies and regulate ALL markets, world-wide.

All of them.

We're all interconnected, so we're finding out, and if one is a stinker, it has ramifications for all of us.

To repeat, for clarification and effect:

Republicans, free-marketeers, corporations and conservatives wanted deregulation;

The deregulation has led to our collapse--all of us--in the entire US and the world;

We're now going to have to re-institute regulation, in the US;

We're going to have to institute world-wide, shared regulation--and rules--so everyone can be kept honest;

All the deregualtion brought on this collapse, which is, in turn, requiring Socialism, really, here in the US and 'round the world.

If that's not the most delicious, all-consuming irony, I don't know what is.

Thank you Republicans, Conservatives, Corporations, free-market supporters and your ilk.

For nothing.

___________________________________________
For a glimpse of what's going on right now, worldwide, with all the financial systems, go to this link:

http://globaleconomicanalysis.blogspot.com/2008/10/economic-crisis-around-globe-continues.html