Pensions Could Defaultl

[GuestHouse]

We might also remind ourselves that back in the day when the stock markets were booming, this forum was awash with 'advice' to get our money out of pensions where the very conservative investing strategies of pension funds was causing us to miss to the boom in the stock market.

It's like 'Heads the sky is falling in' tailes 'The ground is flying up to hit the sky'.

Cluck Cluck ..... Cluck Cluck

[PeaceBlondie]

There is now way too lengthy of a list for things which are too big to fail. And most of them are failing very bigly.

[AlexLah]

Hey Flying, I did not know you have yer own YouTube channel.

Funny

That is basically what is termed a good ole boy.

We dont have any here. They are a bit scary aren't they?

But if you want to see how crazy it can be look at what just this 1 sixty five year old had stashed in his rent a space.

http://www.king5.com/topstories/stories/NW...J.20858484.html

Now this is one unorganized fellow

I actually like the guy in that video, it is so funny to hear that typical American accent and what he is telling comes from his heart.

Yes these pension funds exploding is not a good sign for a lot of us, I hope there is some money left when I retire, wonder how they gonna fix that one.

Any ideas?

[12DrinkMore]

Yes these pension funds exploding is not a good sign for a lot of us, I hope there is some money left when I retire, wonder how they gonna fix that one.

Any ideas?

Yep, they are going to nationalise the pension schemes along with the banks. And then just print the worthless paper.

[GuestHouse]

Yep, they are going to nationalise the pension schemes along with the banks. And then just print the worthless paper.

You've obviously got some kind of inside line on what this and/or the next UK government is going to do.

What's the secret? Tea Leafs?!

[Gary A]

Yeah, anything could happen. The sun may burn out and quit shining tomorrow. All life on earth would die. Or the sky could fall as in a major meteor hit. The dust from a major meteor hit would also create earthquakes and block out the sun. Iran and North Korea could launch nuclear missiles and create a nuclear holocaust.

As for myself, I much prefer NOT to worry about things I have no control over. What will be will be. Life goes on.

[flying]

I actually like the guy in that video, it is so funny to hear that typical American accent and what he is telling comes from his heart.

Yes these pension funds exploding is not a good sign for a lot of us, I hope there is some money left when I retire, wonder how they gonna fix that one.

Any ideas?

That is funny! You think that is a typical American accent? Were you raised on cowboy films?

As for pensions & how they will fix it? There is no fix my friend. At least not for those who were about to retire in a year or even a few.

There is no way they can jump up the amount they have fallen down.

As for some money left when you retire? If everyone learns nothing from this whole thing....Learn at least this.....Trust non with your future... Forget Pensions... forget SS

Pay into neither...Invest in yourself like you should have always done.

Most are already below the value of what they contributed not to mention the years & years of growing that contribution. They ( those who lost ) are not 100% blameless many of the 401k's IRA's etc are self directed & they could have changed them up. But then again most are taught to go long & not worry. That is what the financial Wizards tell them anyway.

The one that I love the most is when they tell their clients.............

It is not a loss till you sell........hahahahah Then the clients go around telling everyone ...yeah Im down but my advisor said its only a loss if I sell. I just need to wait till it jumps back up to its good old levels. Because as everyone knows these companies are sooooooo undervalued now

[henryalleman]

A snippet from a GEAB report

<H3 class=access>The risk of sudden collapse of all capital-based pension systems </H3>Finally, among the various consequences of the crisis for dozens of millions of people in the US, Canada, UK, Japan, Netherlands and Denmark in particular (3), there is the fact that, from the end of the year 2008 onward, news about major losses on the part of the organizations in charge of managing the financial assets supposed to finance pensions will multiply. The OECD anticipates that pension funds will lose 4,000 billion USD in 2008 only (4). In the Netherlands (5) as well as in the United Kingdom (6), monitoring organizations recently blew the whistle asking for an emergency contribution reappraisal and a State intervention. In the United States, growing numbers of announcements call for contribution increases and benefit reductions (7), knowing that it is only in a few weeks time that most of these funds will start calculating their total losses (8). Most of them are still deluding themselves about their capacity to build up again their capital after the markets turn around. In March 2009, when pension fund managers, pensioners and governments will become simultaneously aware of the fact that the crisis is there to last, that it coincides with the « baby-boomer » generation's age of retirement and that the markets will not resume their 2007 levels until many long years (9), chaos will flood this sector and governments will reach the moment when they will be compelled to nationalize all these funds. And Argentina, who took this decision a few months ago already, will appear a pioneer.

Another step towards marxist type of socialism (communism) - or not??

In Europe pensions are organised and paid by the government, also in the Netherlands and Denmark. In Many European countries the pensions are indexed to guarantee a comfortable lifestyle till the end of your life. In Belgium its about 70% of your last year income. In some countries even higher.

It is possible to have an extra pension on top your regular government pension with a private company, but also they are under strict government control and must have a minimum guaranteed interest on capital (in Belgium)

Calling this

Another step towards marxist type of socialism (communism)

can only be a statement of an American.

[Naam]

In Europe pensions are organised and paid by the government, also in the Netherlands and Denmark. In Many European countries the pensions are indexed to guarantee a comfortable lifestyle till the end of your life. In Belgium its about 70% of your last year income. In some countries even higher.

unfortunately you are forgetting one important factor Henry. no european country having a pension/social insurance system as you described it has set aside enough capital/reserves to pay with either capital or proceeds for the pensions. the lion share is paid for by the monthly contributions from those citizens who work. due to demographic changes (people living longer / number of inhabitants not increasing as years ago) the future of the pensions looks extremely bleak. two or three working citizens might be able to bear (together what was set aside) the expenses of a single pensioner. one working citizen alone cannot pay for the pensions of one or two pensioners! but the latter will exactly happen in 2 or three decades depending on the productivity of those who work. and that will also be the end of any indexing to

"guarantee a comfortable lifestyle till the end of one's life".

perhaps nobody discusses this problem in Belgium. but in my country (Germany) it is an open secret that the younger generation which is loaded now with a high tax burden as well as a high burden for social security will receive only a fraction of their present contributions. our government is therefore since several years advising the working population to use own savings and investment in order to compensate for the short fall when they stop working. Europeans of your and my age are lucky because it seems they will just make before they depart for the eternal hunting grounds.

[Naam]

How on earth is my UK National Pension scheme going to fork out 90 quid/week inflation proofed for the rest of my life based on the contributions of an ever diminishing work force in relation to the number of pensioners?

you said it all in one sentence!

[cclub75]

Yep, they are going to nationalise the pension schemes along with the banks. And then just print the worthless paper.

You've obviously got some kind of inside line on what this and/or the next UK government is going to do.

What's the secret? Tea Leafs?!

try "common sense" perhaps ?

-demography (increasing number of people going on retirement, and living longer)

-global (and probably lasting) financial crisis, with returns that in any case won't be enough to cover the needs (+ the new needs)

Explain to me, whether it's US model (money is invested in stocks, houses etc) or french model (people pay taxes to pay the pensions of the retirees, AKA the Madoff Scheme), what could be the other solutions (excepted nationalization, and then the printing machine) ?

-kill the old people (yeah !) or let them die in total poverty

-extend the compulsory number of working years to qualify for a pension (set the retirement age at 80 years for instance)

-reduce the amounts of pensions (so many are already super low)

-increase taxes on the labor force, in order to pay the pensions (in the US maybe, in Europe impossible due to the already very high taxes)

Or maybe a mix of all those ideas ? It's possible, I admit. But still nationalization and printing machine are the easiest path... At least the less painful at the beginning... This is why the temptation will be strong for the politicians.

Edited January 28, 2009 by cclub75

[Naam]

Yep, they are going to nationalise the pension schemes along with the banks. And then just print the worthless paper.

You've obviously got some kind of inside line on what this and/or the next UK government is going to do.

What's the secret? Tea Leafs?!

try "common sense" perhaps ?

-demography (increasing number of people going on retirement, and living longer)

-global (and probably lasting) financial crisis, with returns that in any case won't be enough to cover the needs (+ the new needs)

Explain to me, whether it's US model (money is invested in stocks, houses etc) or french model (people pay taxes to pay the pensions of the retirees, AKA the Madoff Scheme), what could be the other solutions (excepted nationalization, and then the printing machine) ?

-kill the old people (yeah !) or let them die in total poverty

-extend the compulsory number of working years to qualify for a pension (set the retirement age at 80 years for instance)

-reduce the amounts of pensions (so many are already super low)

-increase taxes on the labor force, in order to pay the pensions (in the US maybe, in Europe impossible due to the already very high taxes)

Or maybe a mix of all those ideas ? It's possible, I admit. But still nationalization and printing machine are the easiest path... At least the less painful at the beginning... This is why the temptation will be strong for the politicians.

the "Madoff scheme" is used not only in France but all over Europe and guess what... the U.S. of A. have that mandatory system too. IRAs and 401ks are just supplemental.

[12DrinkMore]

25% of the UK workforce are not entitled to receive public service pensions

25% of the UK work force are working for the government, and presumably still qualify for the civil service pension scheme. Don't think it has been changed yet.

I'm optimistic, the economy is in the doldrums, but these things pass, the markets and investments will recover and the economy will once again grow.

Yep, only a question of time, 3 years (absolute minimum), 5 years, 20 years?

What we've actually had is a very high swing on the £ and now things are going back to what they were - Six months of economic problems is not the end of the British economy, or anyone's pensions.

Wish I could have just a small little dose of your optimism.

[cclub75]

the "Madoff scheme" is used not only in France but all over Europe and guess what... the U.S. of A. have that mandatory system too. IRAs and 401ks are just supplemental.

Indeed. Thanks for the details. For obvious reasons, I know better the french situation, than the US one. ;-)

In any case, It's really worrying to see that so many people (even smart ones) do not understand, grasp this very simple issue.

Try to speak about "Madoff" and french pensions system with some french people... They will say : "Of course not it's not the same".

There is everywhere this kind of "magic thinking" : it's not the same. It won't happen to us.

I've noticed another kind of denials : the migrants solution.

For the supporters of this theory, the solution is simple : young migrants coming to Europe will solve the problem. They will pay our pensions. Case closed.

On the paper and on an economic level its sounds... coherent (even though it could pose huge political problems).

But, again, their brain just disconnects there... When you try to ask them : "please explain to me how poor people coming from Africa, with no education, who don't even speak your language, will be able to take high value added jobs in Europe, in order to get high salary, in order to pay high taxes to finance your pensions"... ?

Which is the reality on the ground (undeniable) of the immigration Europe is getting since so long.

Only one reaction occurs : the blank stare.