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Every American Should Watch This
A dangerous countdown clock is quickly approaching zero. When it does, it could wipe out millions of Americans.
How close are we? What should you do? Please click on this shocking video, created by Emmy-winning director Brooks Moore. Please, do it now.
July 29, 2012
Pension Schemes are The Latest Gigantic Rip-Off
By Shah Gilani, Capital Wave Strategist
You made me promises, promises,
Knowing I’d believe.
Promises, promises
You knew you’d never keep.
Those lyrics are ripped from the early ’80s band Naked Eyes’ hit song “Promises, Promises.”
I use the word ripped, not because it’s a term used in the music business, but because of its more common meaning, as in ripped-off.
Because that’s what we’ve been – ripped off.
This time, which has been going on for a long time, I’m talking about how grossly underfunded both private and public pension funds are, and how we’ll all suffer the consequences.
I’m going to strip out the mumbo jumbo so you see the truth with your own naked eyes.
Retirement is getting further and further away for most Americans. And if they get there, they may not be reasonably compensated by the pension plans they thought they were paying into along with their co-payers, their private and public employers.
That’s because a lot of those co-payers aren’t paying up.
And that’s only part of the problem…
Here’s the other, even more insidious, naked truth.
The investment return assumptions inherent in pension plans’ calculations are so unrealistically high that the chances of funds ever meeting future obligations, or “promises,” is halfway between slim and none.
Don’t worry, I’ll come back to the co-payers not paying up. But first let’s talk about assumptions (as in, making asses out of you and me).
Pension Plans are Based on Unrealistic Projections
The average assumption in the great majority of pension plans is that their assets will appreciate at 8% per year. Now, with compounding, that’s a really great deal.
Too bad the actual hand we’ve been dealt, courtesy of a no-interest rate (actually its closer to zero) Federal Reserve policy, for years now (and rammed-down low rates for years prior, thank you Big Alan Greenspan, with his goofy Ayn Rand hat now sitting in a corner facing backwards somewhere; or at least he should be), makes fixed income returns impossibly low. Low to the point that the “bond” portion of plan asset portfolios are causing the hole they are all slipping into to get bigger and bigger.
To subscribe to Shah’s free newsletter, Wall Street Insights & Indictments and continue reading click here.
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Reader Bill Boswell Put It Best…
“I say this from the bottom of my heart. I was down over $325,000 dollars when the market tanked. Thanks to you I made it all back and I’m up over $80,000.”
Bill Boswell made $405,000 over a year by following The Geiger Index’s recommendations. Keith Fitz-Gerald shows how pure science (not luck) put Bill back on track toward retirement. And how The Geiger could do the same for you. Click here…
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Fascinating New Technology Trends Offer a Glimpse into a Wild Future
By Michael A. Robinson, Defense and Technology Specialist
Call it the “Battle of the Jellyfish Breakthroughs”.
You may remember this from an article I wrote two weeks ago. In it, I talked about a Pentagon-funded robotic jellyfish that uses hydrogen as its power source. It’s a developmental robofish capable of helping in underwater rescues (or spy missions).
Turns out that wasn’t the only big advance inspired by this primitive sea creature…
Just this week, we learned that a crack research team has created something incredible called Medusoid.
That’s their nickname for an artificial jellyfish they made from rat heart cells and a silicone polymer. This bioengineered creature swims by squeezing its muscles, the same way a real jellyfish does.
More to the point, Medusoid could become a great model for testing new drugs. It also could lead the way to advances in artificial hearts and other human organs.
As I see it, these two breakthroughs coming so close together proves that the Era of Radical Change is here. Cutting-edge high tech really is moving at warp speed, with new advances coming faster than any one person can track.
Indeed, there was plenty of fodder for my fascinations of the month.
Take a look as these new technology trends…
To subscribe to Michael’s free newsletter, Era of Radical Change and continue reading, please click here.
This Week’s Most Profitable News
Insights from the week in investing and links to our most-read Money Morning articles.
How the New Healthcare Tax Affects You
As of now Obamacare is going into effect as a healthcare tax. It might not affect you as drastically as you think – here’s the latest info. Read More…
Five High-Value Stocks at Bargain Prices
The economy is looking dreary, but the stock market is still holding hot profits. Here are five stocks with soaring profit potential and affordable price tags. Read More…
With Gold Prices Flat, It’s Time for Junior Miners to Shine
Gold prices have stalled, but junior miner stocks remain undervalued. This one in particular impresses gold stock fanatics and savvy investors alike. Read More…
Investing in ETFs: Check Out These Three for 2012
You want variety, affordability, and tax benefits in an asset? Then check out the reasons for investing in ETFs – and consider these three. Read More…
Apple Earnings Miss Points to Slowing Growth
Apple earnings disappointed for the second time in a year. After an amazing run, we finally may be seeing signs the tech giant is getting winded. Read More…
The Hidden Cost of Peak Oil
What is peak oil? Not what you think. It’s a very real U.S. event hitting your wallet soon, and this info is your best defense against the price pain. Read More…
Three Natural Gas Stocks Ready to Ride the Price Rebound
After months of record-low natural gas prices, they’re trending upward. And these three natural gas stocks will let you profit from that rise. Read More…
To read more timely investment advice and access your free investor reports, just visit the Money Morning website by clicking here.
On Air Now
Why AMZN Stock is Soaring
Don’t Get Fooled: How to Spot Companies That Lie About Earnings
A Dividend Paying Stock for “Times Like This”
Our Experts
Keith Fitz-Gerald
Four Ways To Not
Lose Money In A
Bubble Economy
Dr. Kent Moors
Eurozone Debt Crisis Won’t Be Fixed by “Bailout Lite”
Martin Hutchinson
How to Boost Your Income in a World Where a Six Figure Salary No Longer Cuts It
William Patalon III
Here’s A Glimpse Into The Future
Shah Gilani
I Admit It, I Was Wrong About Regulation
Michael A. Robinson
Man-Made Proteins Put a New Twist on Evolution – And They Fight the Flu
Peter Krauth
While Banks Crumble, The Next Leg Up For Gold Prices Draws Near
Key Economic Reports
This Week
Date
Release
7/30
None scheduled
7/31
Personal income (6/12); Consumer spending (6/12); Core PCE price index (6/12); Employment cost index (6/12); Case-Shiller home prices (5/12); Chicago PMI (7/12); Consumer confidence index (7/12)
8/1
ADP employment (7/12); Markit PMI (7/12); ISM (7/12); Construction spending (6/12); Motor vehicle sales (7/12); FOMC announcement
8/2
Weekly jobless claims (7/28/12); Factory orders
8/3
Nonfarm payrolls (7/12); Unemployment rate (7/12); ISM nonmanufacturing (7/12)
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