Medicare and Social Security Deceit

                       

The biggest Ponzi schemes are being sponsored by the U.S. Government

Prime examples: Medicare and Social Security are estimated to be short by over 110 trillion dollars. That makes them completely bankrupt, were they genuine, private insurance enterprises.

                       

The average American has no idea how Social Security works. He or she will tell you it’s as advertised. It’s not, because there is no trust and reserve fund, though you often hear politicians mention “lock box.”.

                       

Benefits are paid today from earnings of those still working, So, what makes this different from any other Ponzi scheme? Paying off some today with money taken from others, to whom benefits are promised tomorrow. Social Security tax funds taken in, are never really invested. They are used to pay off Social Security obligations of today.

                       

Government has already exhausted what is supposed to be the Medicare Trust Fund. Social Security will run out of money in a couple of decades, or much sooner, when there are probably not enough workers to pay off retirees.

                       

What  makes these programs different from other Ponzi schemes?(See the Earl J. Weinreb NewsHole® comments and @BusinessNewHole tweets.)

,Unaffordable Entitlements

                       

By 2050, Social Security, Medicare and Medicaid, will take up the entire federal budget, if it remains on its present course. By 2080, Medicare alone will comprise the entire federal budget.

                       

This projection is unsustainable. There will have to be some changes done by politicians in office as problems ensue.

                       

The impending debacle does point up the stupidity of those in office today, who have set forth a path to disaster, for us, our children and grandchildren.

                       

Congress and the administration are creating a bankrupt system for us and our descendants. Solutions will only involve far less services and benefits, with rationing and much higher taxes, as well as huge inflation.

                       

We have never encountered such financial problems before. (See the

Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)   

Media Investing Portfolios

                       

Financial portfolios you get in the media are amusing but they are not a laughing matter. Because you can get burned if you follow such advice.

                       

The media suggestions come with some advisor mentioned; the one making the recommendations. That advisor has been singled out from among tens of thousands in the business.

                       

Advisers are always seeking publicity; they strive to have pet portfolio ideas published in public view. So why this mention? Is it a friend or relative of the columnist or reporter or interviewer?

                       

Furthermore, the portfolios are usually an attempt to time the market. Also, they never identify objectives by investor age or risk capacity

or psychological sensitivity. It makes the reportage useless. And dangerous.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

                       

           

Economic Stimulus Bait and Switch Fiasco

                       

The “stimulus,”  has evolved in its usage. The old meaning had been perfectly useful in Keynesian economic parlance. But it has now became a cover for politicians who conveniently use the term to hide other motives they may have.

                       

What the bulk of the population in the U. S.thinks of when Washington attempts to stimulate the economy is spending that will get business moving, employers hiring and consumers buying as quickly as possible.

                       

Poor psychology is what makes deep economic recessions linger on. A true stimulus must promptly change that poor psychology.

                       

But when only a small amount of stimulus money is actually designed to be spent quickly, another motive is apparent. When the vast bulk of stimulus money is designed to be a slush fund to expand federal and state government jobs, the goal is primarily different. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewHole tweets.)

Your Annuity Costs

                       

Annuity sales pitches often overlook start-up costs of annuity contracts; they can be in effect for up to seven years.

                       

Salesmen commissions and administrative expenses must be met. Early termination requires faster amortization. These are in addition to management fees that are imposed each year on annuities that involve variable investment.

                       

Furthermore, the annuity may have life insurance provisions that you may not need. You pay for that feature.

                       

So annuities involve costs you are not aware of, And you simply cannot drop contracts easily. There will be penalties for making corrections or changing your mind. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

The Media's Financial Education

                       

Investors get most of their financial and business education from the media, especially brief bytes and headlines.

                       

Schools don’t provide an adequate underpinning of information for students to be able to comprehend economics and finance in the real world. As a result, the public cannot evaluate the bombardment of ads, nor headlines that apply to finance and business topics, or meaningful explanations from inept media sources.

                       

They therefore get biased, one-sided opinions without any contrasting arguments or alternatives from headlines or inadequate financial and business articles.

                       

                  

Brokers and advisers cited in the media frequently promote a particular point of view. The media often poorly screens content.

                       

Remember also, the importance of investor age, family status, personal psychology, finances and risk status, have lots to do with investment choice, Media slants often neglect them.             

                     

So stay alert to basics and avoid tips from questionable media sources. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

shole tweets.)

Investment Advice in Ads

 

                       

Ads give only the advantages, and not the downsides of investments being suggested. Why take the advice? Yet, so many investors learn about what they buy solely from ads and salesmen.

               

I have now researched over 1,600 investment strategies that are occasionally or frequently used. I have also looked into the pros and cons of each. And I have not found one that has an exclusive advantage, without at least one disadvantage.

                       

An example: Sellers of gold investments may be selling one type without discussing various other forms, or whether everyone ought to be buying gold, despite looming inflation. The public never gets full information.

                       

Furthermore, investor age, family status, personal psychology, finances and risk, have lots to do with investment choice. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

   

Government Deficits Are Worse Than Too Many Think

                       

Too many American voters appear to think differently but you can be certain that government deficits will spell disaster. For taxpayers and even for those who don’t pay taxes, nor anyone who worries about the cost of living.

                       

Government spending debts can easily be borrowed away. That debt of today, however, is being financed at very low interest cost. Those costs will easily double and triple. Long term rates can conceivably reach 18% or so from under 3% right now,

                       

So we are looking at astronomical debt, with poor prospects of an economy expanding where it can accommodate that debt.

                       

The public will eventually see that today’s spending is only a down payment on future costs, to be paid by heavy taxes and a more worthless dollar. Yes, if taxes don’t foot the bill, a worthless, inflated dollar will.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Big Investors' Fees

                       

Even pros are feeling those adviser fees. Huge institutional investors should be able to get better terms as investors than do smaller investors. Mutual funds do reduce expenses to clients who keep larger fund balances. This is perfectly logical and it’s legal.

                   

But the U.S.government  has not been happy about fee discounts if done in unison by organized major investors. They include; endowments, foundations and pension funds, as part of groups, Institutional Limited Partners Association (ILPA), The group’s members have more than one trillion dollars at work.

                       

They would all like to negotiate lower terms than they have been getting. But it would be against the “anti-trust” law. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Treasury Department Gold

 

                       

There’s been lots of talk about how Treasury Department gold can be used, or whether it ought to be kept as it is.

                       

At its present price, the gold’s value totals about $400 billion. One suggestion has been to use it to reduce U.S. debt. I would rather not sell gold for this purpose, I feel it will not reduce or affect government spending habits,

                       

I believe the gold holding ought to instead be used to back the U.S. dollar. The stability would be an economic boon. That would also accompany reduction of government spending and debt.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Over-Paid Financial Advisers

                       

As you probably know from my reports, I find professional advisers extraordinarily expensive for most ordinary investors. They take as much as 20% and more of earnings when their cut is 11⁄2% or more of assets managed. Only investors who require estate and tax advice need additional expert consultation.

                       

To make themselves appear necessary, advisers will make up portfolios with as much as ten and more individual funds when just a few, low cost funds will do. The assortment is supposed to be the result of more selective investment thought. But the end result is meaningless, apart from marketing the adviser’s service.

                       

I have written volumes about the subject, but to sum up, let me repeat a simple lesson: Once you learn investment basics, you can manage your own investments with low-cost index mutual funds, (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)