The pensions are a fiction, but my feeling is a lot is going to be done once again in an attempt to preserve these fictions leading to even more bad debt and market dysfunction.
Perhaps we should just let the PBGC put all their money on Lucky 13 and give the wheel a spin. Either they will "win back" their losses or shut down the shop and let everyone take a government pension.
When does the reality set in and change from pensions to contribution retirement system? There is no way anyone can see the future in America and promise a set retirement anymore.
Groundhogday
Doesn't matter if you bet and win, when there are no counter-parties with that money available. That is why all credit bubbles must ultimately end
I know, we can invest the social security surplus in the stock market. That will bailout wall street, pensions and social security simultaneously. Sweet!
Hey, maybe we could even leverage the social security surplus via the PPIP. I'd feel better if Goldman gave it a nod though.
It isn't like CalPERS or UAW or any number of other future participants in PBGC aren't going to affect performance.
People need to think about something. How will PBGC pay for ongoing obligations? Ans: by SELLING assets. This year. Next year. Every year for decades they'll be selling into the teeth of a buyers strike.
Our government is broke. Social security and medicare are going broke shortly. Our financial system is insolvent and now our pension guarantee system is on the ropes.
The above really underscores why wall streeters had to work 80 hours/week over the past 15 years. You can really see how they earned their bonuses too.
this reminds me of the beginning of the end for the Roman Empire: corruption, centralization of power, scandal and inbreeding....PBGC is atypical of an attempt by a largely failing oligarch to push the issues onto an ever skeptical populace disonnected from "TPTB" yet ensconced in the slowly fading ideal that taxes for the benefit of the greater good in the name of glory for a failing empire. When and how ill the madness end? PBGC is a symptom of a much larger problem.
alybaba,
Doesn't even matter, they are not even correct with operating earnings.
Using S&P's data (XLS file)
12 month trailing operating earnings: $49.51, or $42.98 if using the 09Q1 which has 95% reporting. S&P500 at 903
P/E of 21 (903/42.98) to P/E of 18.2 (903/49.51)
That's what I meant when I said they made no sense, not by any measure. At this point Birinyi could only be using proprietary data that does not believe companies earned so little. It's not misleading or deceitful. It is simply wrong
Congress can create an insurer to insure PBGC, the PBGCGC (Pension Benefit Guaranty Corporation Guaranty Corporation)--but that one will not be solvent either.
The problem with having fido on a leash for most Walter Mitty Sobchaks, is the dilemma of reloading with just one hand, as the other is busy stroking it's metallic Johnson
I highly recommend reading "Confessions of an Economic Hit Man" at this juncture. If this book is any indication there is much, MORE more that can be done to drag this clter fk out for a long time.
Juvenal Delinquent (profile) wrote on Wed, 5/20/2009 - 3:51 pm Can you only imagine all the Walter Mitty Sobchaks that are going to show up, guns @ the ready in our National Parks?
You don't need imagination. The experiment has been repeated many times in the recent past as states have adopted "shall issue" concealed carry laws. In 1987, when Florida enacted such legislation, critics warned that the "Sunshine State" would become the "Gunshine State." Contrary to their predictions, homicide rates dropped faster than the national average. Further, through 1997, only one permit holder out of the over 350,000 permits issued, was convicted of homicide. (Source: Kleck, Gary Targeting Guns: Firearms and Their Control, p 370. Walter de Gruyter, Inc., New York, 1997.) If the rest of the country behaved as Florida's permit holders did, the U.S. would have the lowest homicide rate in the world.
@ mmckinl (profile) wrote on Wed, 5/20/2009 - 4:19 pm
Why Barack Obama Cannot Prevent America's Next Great Depression ... Page Not Found...
A long winded post....come on Shel cut to the chase
His best blurb
It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who are tied to the Wall Street oligarchy by an umbilical chord than cannot be severed.
Hey look at my blurb that I've posted repeatedly here
Obama's #1 economic mission ( in collusion with the 19 too big to fail banks that got trillions in TARP ) is to pump up great chunks of the Big Shitpile that's essentially worthless unless the peak real estate values of the bubble can be miraculously restored.
According to PBGC estimates, auto sector pensions are underfunded by about $77 billion, of which $42 billion would be guaranteed in the event of plan termination .
Yawn ... already priced in by the global robberbarons' debt-equity bubble pig model.
I do not understand the issue about the national parks. Are there daily firefights just outside the park gates, and people are happy with daily firefights on one side of the park gates but do not want the same firefights on the other side of the park gates?
Juvenal Delinquent (profile) wrote on Wed, 5/20/2009 - 4:23 pm
There were 70 million visitors to our National Parks in 2006 and 11 people were murdered that year within the boundaries...
If only America was more like it's National Parks?
People need to think about something. How will PBGC pay for ongoing obligations? Ans: by SELLING assets. This year. Next year. Every year for decades they'll be selling into the teeth of a buyers strike.
I've been saying for decades that societies can't save - not if that means producing excess goods & services now for consumption later. Not really. All saving is is trading production today [or a claim against production] for a claim against future production... if there are more claims than production you have inflation... severe enough and some go without [famine].
Doesn't matter if the claims are housed in a private system like the stock market & 401Ks or public like SS... it really all comes down to how many goods/services are available & the number of claims placed against them...
I wonder if politicians and economists were talking about green shoots in 1931? Heck, I think we still discovered tribes in the Amazon afterwards, not sure..So my money is more on green trees, green grass, green mile....
Not One Cent (homepage, profile) wrote on Wed, 5/20/2009 - 4:29 pm I do not understand the issue about the national parks. Are there daily firefights just outside the park gates, and people are happy with daily firefights on one side of the park gates but do not want the same firefights on the other side of the park gates?
No, AFAIK the law would simply apply state law, with respect to guns, to national parks within that state's boundries.
teabagger (profile) wrote (in reply to...) on Wed, 5/20/2009 - 7:19 pm
You don't need imagination. The experiment has been repeated many times in the recent past as states have adopted "shall issue" concealed carry laws. In 1987, when Florida enacted such legislation, critics warned that the "Sunshine State" would become the "Gunshine State."
Don't bother trying to pop the Pond Prince's bubble with facts. American Puritans have no need of the facts, such things have no bearing on the Calvinist Elect.
@ Rob Dawg
It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who...
love to bend the American taxpayers over and say whose you daddy !
FT Breaking News
BofA seeks to repay $45bn by end of year
So they'll use the new capital they raised to pay off TARP then they'll be under-capitalized again and we'll give them back the TARP money and then...LET ME OUTTA HERE!!!
We were backpacking in a national park years ago. We had pitched our tent, I had made that no food was in the tent, what we did have was suspended off the ground in a tree. I woke up in the middle of the night to a snorting, snuffling sound outside the tent. I groggedly look out through the mesh that served as a door and saw a large black bear sniffing around where we had eaten dinner. This was about 5 ft from me.
I had a .38 next to me. The following ran through my mind.
1. I could scream but that would wake up the wife who was already pissed because the trail was hilly.
2. I could fire off a shot at the bear which would just piss it off, wake up the wife, who would then be totally freaked.
3. Or I could go back to sleep and let the bear sniff all it wanted.
I went with 3. If it had been Montana and a grizzly things might have been different. Then again you would need a cannon for a grizzly and firing anything off inside a tent is hard on the hearing.
Rob Dawg (homepage, profile) wrote on Wed, 5/20/2009 - 11:40 pm
splat (profile) wrote on Wed, 5/20/2009 - 4:38 pm
reply ignore user sigh another day.. another bailout...
I'd be happy with just one a day...
Then, we would have to have two bailouts the next day andd there would be overtime costs.
"Doesn't matter if the claims are housed in a private system like the stock market & 401Ks or public like SS."
401K's unlike pensions are controlled by the individual and if they are the least bit living in the real world understands there is a conservative way and a risky way to invest. They will also realize wall street wins and loses. Those who don't understand get taught a lesson.
The rationale for weapons in the nat'l parks is that as the economy crumbles people will seek refuge there -- running water, etc. Since it is impossible to prevent people from bringing their weapons into the parks, it is best to allow them to bring them in, rather than criminalize them (victims of bankster/government greed and stupidity). Does that make sense? Ha, ha, ha.
" Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 4:48 pm
401K's unlike pensions are controlled by the individual and if they are the least bit living in the real world understands there is a conservative way and a risky way to invest. They will also realize wall street wins and loses. Those who don't understand get taught a lesson."
um, not my company's 401K. we have zero control on where the money goes and there is no transparency. once a year the plan administrators come into our office for a presentation on all the money we lost. which is why i'm not in the plan.
this goldman guy birinyi is the one feeding crap stats to the wsj.
in todays bloomturd he says,
"The S&P 500 may jump to a record 1,700 as the economy rebounds from the
worst recession since World War II, an increase from today’s close of
903.47, said Birinyi, who spent a decade on the trading desk at Salomon
Brothers Inc. Signs the global contraction is easing have spurred a 34
percent rally by the index since it sank to a 12-year low in March. "
"um, not my company's 401K. we have zero control on where the money goes and there is no transparency. once a year the plan administrators come into our office for a presentation on all the money we lost. which is why i'm not in the plan."
Your choice to accept the position and give away control may not be wise come retirement time. No one looks out for you but you. Good luck
The taxpayers should bailout the PBGC. The taxpayers can pay themselves to retire.
I'm still up in the air on the fate of the dollar, nearer term. The banks seemed to want money badly. REITs too. I have never seen secondary offerings priced as quickly as in the last couple months. The instant the stock got high enough, the companies tried to grab as much cash as possible. Also, California has no money. GM has no money. It seems like money is the only thing no one has a lot of. People definitely hold assets claiming to be a form of money. I don't put a high probability of the Fed Gov reneging on its shorter term obligations quite yet, so right now deflation seems likely to me. I think the dollar is set up for a massive short squeeze.
unirealist,
My theory contemplates the same actors engaging in the same activity, but they are doing it to fund the hedgies so they will have cash for the PPIP.
I didn't see Lobbyi$t's post -- I have banned him for pressing a political point of view -- but it is the height of ridiculosity to assume that all 401K participants can control their fate. I know of one that until recently didn't have any capital preservation options, like gov't bonds. They did, recently, provide a bond fund, but read the prospectus and you learn that it invests in MBSs !!!
"So they'll use the new capital they raised to pay off TARP"
"Then they'll pay the annual bonuses for paying off TARP and doing an excellent job, million $ all round please"
"Then they'll be under-capitalized again and we'll give them back the TARP money"
Return to step 1
Not that anyone in the administration would have any interest in jeopardizing their post-Washington seat on the board of a Wall street institution, but after the TARP $$$ is repaid, if a bank screws-the-pooch a second time ( GUARANTEED TO HAPPEN ) they should be cut loose and face the harsh wind of Capitalism.
But we all know that every politically connected corporate is just too big-to-fail and you gotta save your post administration retirement plan.
nova (profile) wrote on Wed, 5/20/2009 - 5:03 pm
reply ignore user
The new National Park Service ad campaign.
Close in on Smokey the bear who smiles at the camera as he holds up an AK-47
Cue a friendly gruff voice "Rememberm only you can prevent accidental firearms discharges!"
Better:
"What do you think about these rights to bear arms? Punk!"
But is a 401k a wise choice? To me, a 401k is basically money you've earned that you let the government attach strings to. I know there is a "tax advantage" but is it worth locking up your money to unwittingly gamble on the level of taxation over time?
Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 7:58 pm
Your choice to accept the position and give away control may not be wise come retirement time. No one looks out for you but you. Good luck
Like those assets won't be confiscated by the state or inflated into worthlessness by the time he retires unless he's like 60 now. I guess you could take the money on the off chance some survives til you leave the company and buy Bunds with it after you rolled it into your own account. It'll still get confiscated by the state, though.
"That's what I meant when I said they made no sense, not by any measure. At this point Birinyi could only be using proprietary data that does not believe companies earned so little. It's not misleading or deceitful. It is simply wrong"
why in the world do you always give an out to the blatant cons? it IS misleading and deceitful. you did the same thing in the overnight thread with cashonlyhousing who is onto something fishy in the GDP data.
Not a 401K investment person. What is the difference from a IRA or Profit sharing? I was able to invest in pretty much what ever wanted. That is my point to control you destiny. As of today I have not had a down year since the Dot com bubble.
My retirement is quit diverse. The government can take away very little. I deal in tangible assets and little in retirement accounts. I look out for me and have been anticipating this mess for many years.
There are many German tourists in the nat'l parks. Yosemite, Death Valley and Grand Canyon I can personally vouch for. But, because they don't bring firearms into the US, it is unlikely that they'll be armed.
Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 8:08 pm
Not a 401K investment person. What is the difference from a IRA or Profit sharing?
Fixed menu of investments. Generally heavy emphasis on equities mutual funds.
I was able to invest in pretty much what ever wanted. That is my point to control you destiny.
You don't control your destiny with a designated retirement account. After IndyMac, the federal regulators forced on the banking system the ability to freeze and haircut any account by an arbitrary amount via software, ostensibly to provide insurance against bank runs, and some of that "national security, drug money yadda yadda" shit.
One bright morning when the money runs out, they will use that to freeze and seize all your cash and pump it into the social security trust fund as part of a "reform" that gives them a new piggy bank to rob. Hence the Argentina reference.
As of today I have not had a down year since the Dot com bubble.
Measured in what? By any reasonable anticipation of future purchasing power, you've been scalped.
So forgive me if this is covered in the 100+ comments above:
According to PBGC estimates, auto sector pensions are underfunded by about $77 billion, of which $42 billion would be guaranteed in the event of plan termination.
So how does this happen? The pension $$ that people are expecting are cut (roughly) in half?
Pensions are obviously going to be protected at all costs as long as we continue to have representative government. The cohort of voting pensioners is too large for anything else, and social stability also weighs in. What pensions can purchase is another matter.
The make up at Untitled Document is definitely changing fast to govt, state etc....
Wage income for workers who were lucky enough to have kept their jobs fell almost 43% between 1929 and 1933...
Whats the over/under for 07-11? how about a pool broken down to decimal points in range of 3% to 50% $10 squares. 1rst 2nd and 3rd place.. meet in Tehachapi in 2011 for bear feast with wine and spirits on Jas.....
think of the paper and ink demand when the Pre Clinton methodology is applied to the presses as the CPI goes under 1...
dollars will be shattered and thats all that matters to Mrs Watanabe....Yu must realize that interpretations of the governmental investments will not be counted against the depth of the Dubya-Hole.
If governments prints, one submits to 10-1 social leverage AUsterity measures.
The auto sector numbers mentioned in your comment are not currently trusteed by the PBGC. That is just the exposure that PBGC has to the sector --- however, PBGC will likely end up taking some of those plans as various auto suppliers either fail or are bought by another party in the bankruptcies/liquidations.
The article only mentioned the unfunded liabilities for the sector so we don't know the level of plan assets. For example, if the auto sector pensions had $77 billion of assets, this would mean that there are $77+$77=$154 billion of total liabilities and $77+$42=$119 billion of liabilities guaranteed by the PBGC. In that case, pensioners would get $119/$154 = 77% of the money they were promised overall. However, each individual's situation could vary dramatically.
Sorry I was on a tele conference with my Senator. One who seems to give a dam what the people that elected think. Very interesting voting tonight.
"Measured in what? By any reasonable anticipation of future purchasing power, you've been scalped."
If you want to use the excuse inflation then I lose. I believe there is longer term power in accumulation especially coupled with no debt. I don't play by popular rules. Ever own three personal homes? I have and now enjoy the simple life and am prepared to be one of the last standing. So consider it won't be me who takes me out it will be everybody else. My out side of government investments have a very good return and will flex with what ever happens close to total collapse. If the government comes to take away my dirt and other hard assets it is game over for all. So I have done all possible to control and determine my destiny.
I would also like to make one correction to CR's comments.
CR said: "Last year the PBGC voted to allow equity investments, but luckily the entire portfolio wasn't moved into equities - and they only lost $3 billion on their $56 billion asset portfolio."
PBGC already allowed equity investments before the new investment policy was announced in February 2008. However, due to the internal investigation of the former director's (Charles Millard) communications with the bidders for allocating money to private equity and real estate, the shift of assets was placed on hold, so the asset allocation you see today was in place before the announcement of the new investment policy. This eventually resulted in the hearing that was held today by the Senate special committee. It's quite possible that the new policy will never be implemented.
There was a lot of fuss over the Boston Globe article published a couple months ago about this issue, but the Boston Globe could not verify if the assets were ever shifted. Today, we received confirmation that those assets, thankfully, were not shifted.
Think this is bad? CALPERS is teetering on the brink and not reporting their true losses. Don't think the state of California can actually afford the benefits they've agreed to. This is old but I remember seeing an update that was more damning. Hidden Pension Fiasco May Foment Another $1 Trillion Bailout - Bloomberg.com
We'll just grow our way out the problem.
If we can't grow our way out, we can borrow our way out.
The wrought has set in...
The pensions are a fiction, but my feeling is a lot is going to be done once again in an attempt to preserve these fictions leading to even more bad debt and market dysfunction.
Should I get this t-shirt?
2x+ good...
Money loses value when it has become too multiplied
King Sigismund (1526)
All your pensions are belong to Ben Bernanke.
one solution > Washington, Washington D.C. Real Estate & Washington Homes for Sale - Zillow
Perhaps we should just let the PBGC put all their money on Lucky 13 and give the wheel a spin. Either they will "win back" their losses or shut down the shop and let everyone take a government pension.
When does the reality set in and change from pensions to contribution retirement system? There is no way anyone can see the future in America and promise a set retirement anymore.
Benjamins (Dr. Rudolf Havenstein) Bernanke
"of which $42 billion would be guaranteed in the event of plan termination."
The answer is always 42. Failed pension plans will have to be converted into 42Ks.
"probably"
You're such an optimist, CR.
Pensions are a store of wealth ...
in the underlying economy ...
the economy has now peaked ...
in real terms ... for at least a decade ...
Can you only imagine all the Walter Mitty Sobchaks that are going to show up, guns @ the ready in our National Parks?
Groundhogday
Doesn't matter if you bet and win, when there are no counter-parties with that money available. That is why all credit bubbles must ultimately end
I sold my Sep calls and doubled up on my Sep puts. Now just short SPY, long USO,USL,GDX,GLD.
the credit bubble has undermined every sector ...
and now wealth is on the wane ... for years and years ...
unless you are a banker ...
whose pockets will once again be filled ...
I know, we can invest the social security surplus in the stock market. That will bailout wall street, pensions and social security simultaneously. Sweet!
Hey, maybe we could even leverage the social security surplus via the PPIP. I'd feel better if Goldman gave it a nod though.
I never understood the point of having insurers against insolvency that are themselves insolvent (PBGC, FDIC, SS).
Otishertz
More on WSJ and Birinyi - the screen caps from Jan 2009 show they are deliberately hiding that they are using operating earnings
Wall Street Journal and Birinyi Associates are lying about P/E ratios - 26-Apr-2009 - Generational Dynamics - Web Log
I'd sell my future Social Security payments for a pittance, but who'd be stupid enough to buy it?
It isn't like CalPERS or UAW or any number of other future participants in PBGC aren't going to affect performance.
People need to think about something. How will PBGC pay for ongoing obligations? Ans: by SELLING assets. This year. Next year. Every year for decades they'll be selling into the teeth of a buyers strike.
"I never understood the point of having insurers against insolvency that are themselves insolvent (PBGC, FDIC, SS)."
~~~~
didn't used to be ...
it pays to mute social unrest ...
so the oligarchs aren't embarrassed ...
by having to shoot rioters ...
Our government is broke. Social security and medicare are going broke shortly. Our financial system is insolvent and now our pension guarantee system is on the ropes.
The above really underscores why wall streeters had to work 80 hours/week over the past 15 years. You can really see how they earned their bonuses too.
this reminds me of the beginning of the end for the Roman Empire: corruption, centralization of power, scandal and inbreeding....PBGC is atypical of an attempt by a largely failing oligarch to push the issues onto an ever skeptical populace disonnected from "TPTB" yet ensconced in the slowly fading ideal that taxes for the benefit of the greater good in the name of glory for a failing empire. When and how ill the madness end? PBGC is a symptom of a much larger problem.
a Pauper Annexationist Nation is what we've become, nothing more.
"I never understood the point of having insurers against insolvency that are themselves insolvent (PBGC, FDIC, SS). "
Red tape and greenbacks used for insulation. May not stop NRA bullets but enough layers might deflect a pitchfork.
alybaba,
Doesn't even matter, they are not even correct with operating earnings.
Using S&P's data (XLS file)
12 month trailing operating earnings: $49.51, or $42.98 if using the 09Q1 which has 95% reporting. S&P500 at 903
P/E of 21 (903/42.98) to P/E of 18.2 (903/49.51)
That's what I meant when I said they made no sense, not by any measure. At this point Birinyi could only be using proprietary data that does not believe companies earned so little. It's not misleading or deceitful. It is simply wrong
My wife and I got our letter
about our pensions ...
Better shape than most ... for a year ...
then the worry begins ...
or maybe another letter before then ...
Juvenal,
Will they bring their pomeranians with them?
I wonder if *** is getting the D.T.'s (Delirium Treasures) from getting sauced on his investments?
S&P earnings ?
Extraordinary losses
one offs
Restructuring
every quarter ...
never counted ...
Congress can create an insurer to insure PBGC, the PBGCGC (Pension Benefit Guaranty Corporation Guaranty Corporation)--but that one will not be solvent either.
banksters get trillions ...
the people get peanuts ...
I can hear it now:
Prince Saud: "Dear Barack, I will exchange with you 1,000 barrels of crude for one aging American to sit on their ass for one year."
Yeah, right. Just where is this "bail-out" money going to come from?
"Will they bring their pomeranians with them?"
The problem with having fido on a leash for most Walter Mitty Sobchaks, is the dilemma of reloading with just one hand, as the other is busy stroking it's metallic Johnson
I highly recommend reading "Confessions of an Economic Hit Man" at this juncture. If this book is any indication there is much, MORE more that can be done to drag this clter fk out for a long time.
Why Barack Obama Cannot Prevent America's Next Great Depression ...
Sheldon Filger: Why Barack Obama Cannot Prevent America's Next Great Depression
Juvenal Delinquent (profile) wrote on Wed, 5/20/2009 - 3:51 pm Can you only imagine all the Walter Mitty Sobchaks that are going to show up, guns @ the ready in our National Parks?
You don't need imagination. The experiment has been repeated many times in the recent past as states have adopted "shall issue" concealed carry laws. In 1987, when Florida enacted such legislation, critics warned that the "Sunshine State" would become the "Gunshine State." Contrary to their predictions, homicide rates dropped faster than the national average. Further, through 1997, only one permit holder out of the over 350,000 permits issued, was convicted of homicide. (Source: Kleck, Gary Targeting Guns: Firearms and Their Control, p 370. Walter de Gruyter, Inc., New York, 1997.) If the rest of the country behaved as Florida's permit holders did, the U.S. would have the lowest homicide rate in the world.
What most Americans are looking forward to whether like it or not
a) lower standard of living
b) getting a new dream and fast
c) both choices above
There were 70 million visitors to our National Parks in 2006 and 11 people were murdered that year within the boundaries...
If only America was more like it's National Parks?
"Why Barack Obama Cannot Prevent America's Next Great Depression ..."
Nope but he is helping make sure it is a great one!
IMF tells Britain: cut budget deficit (Guardian)
IMF warns borrowing will leave UK vulnerable as recovery will be slower than forecasts
o_0
The US might kinda suck in 20 years.... I hope not but based on current trajectories I have my doubts....
poic
THE book of our times ...
"Disaster Capitalism : The Shock Doctrine"
Naomi Klein ...
~~~~
The prologue trilogy :
"Blowback"
"Sorrows of Empire "
"Nemeses"
Chalmers Johnson
We have bailout! The most prudent move is a bailout!
@ mmckinl (profile) wrote on Wed, 5/20/2009 - 4:19 pm
Why Barack Obama Cannot Prevent America's Next Great Depression ...
Page Not Found...
A long winded post....come on Shel cut to the chase
His best blurb
It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who are tied to the Wall Street oligarchy by an umbilical chord than cannot be severed.
Hey look at my blurb that I've posted repeatedly here
Obama's #1 economic mission ( in collusion with the 19 too big to fail banks that got trillions in TARP ) is to pump up great chunks of the Big Shitpile that's essentially worthless unless the peak real estate values of the bubble can be miraculously restored.
According to PBGC estimates, auto sector pensions are underfunded by about $77 billion, of which $42 billion would be guaranteed in the event of plan termination .
Yawn ... already priced in by the global robberbarons' debt-equity bubble pig model.
Now just short SPY, long USO,USL,GDX,GLD. ~Eric
I was humoring myself the other day and thought about buying GLD puts with a strike price of say $2....
I dont think gold is going that way but if there was a melt down in the GLD company (proshares?) it could crash...
I didnt tho...
I do not understand the issue about the national parks. Are there daily firefights just outside the park gates, and people are happy with daily firefights on one side of the park gates but do not want the same firefights on the other side of the park gates?
Yes, but you can certainly book it as a profit and kick the can down the road.
Juvenal Delinquent (profile) wrote on Wed, 5/20/2009 - 4:23 pm
There were 70 million visitors to our National Parks in 2006 and 11 people were murdered that year within the boundaries...
If only America was more like it's National Parks?
You mean not working at the time?
People need to think about something. How will PBGC pay for ongoing obligations? Ans: by SELLING assets. This year. Next year. Every year for decades they'll be selling into the teeth of a buyers strike.
I've been saying for decades that societies can't save - not if that means producing excess goods & services now for consumption later. Not really. All saving is is trading production today [or a claim against production] for a claim against future production... if there are more claims than production you have inflation... severe enough and some go without [famine].
Doesn't matter if the claims are housed in a private system like the stock market & 401Ks or public like SS... it really all comes down to how many goods/services are available & the number of claims placed against them...
I wonder if politicians and economists were talking about green shoots in 1931? Heck, I think we still discovered tribes in the Amazon afterwards, not sure..So my money is more on green trees, green grass, green mile....
A long winded post....come on Shel cut to the chase
Cliffnotes: Obama is a genius philosopher-king but an innocent victim of evil capitalists.
. . . Or you can watch Obama Girl's "I've Got a Crush on Obama" video for a similar message.
Oh, my bad. you clearly meant we should all be living a low density exurban lifestyle.
Not One Cent (homepage, profile) wrote on Wed, 5/20/2009 - 4:29 pm I do not understand the issue about the national parks. Are there daily firefights just outside the park gates, and people are happy with daily firefights on one side of the park gates but do not want the same firefights on the other side of the park gates?
No, AFAIK the law would simply apply state law, with respect to guns, to national parks within that state's boundries.
@ Not One Cent @ 4:33 pm
yes cliff notes for the beguiled
teabagger (profile) wrote (in reply to...) on Wed, 5/20/2009 - 7:19 pm
You don't need imagination. The experiment has been repeated many times in the recent past as states have adopted "shall issue" concealed carry laws. In 1987, when Florida enacted such legislation, critics warned that the "Sunshine State" would become the "Gunshine State."
Don't bother trying to pop the Pond Prince's bubble with facts. American Puritans have no need of the facts, such things have no bearing on the Calvinist Elect.
It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who...
So much for the theories of "obvious leadership" and "towering intellect."
"Nope but he (Obama) is helping make sure it is a great one!"
~~~~
Yep, and wasting valuable time and money
trying to fill a "black hole" ...
sigh another day.. another bailout...
@ Rob Dawg
It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who...
love to bend the American taxpayers over and say whose you daddy !
km4 Wed, 5/20/2009 - 4:28 pm
Yep ...
splat (profile) wrote on Wed, 5/20/2009 - 4:38 pm
reply ignore user
sigh another day.. another bailout...
I'd be happy with just one a day...
FT Breaking News
BofA seeks to repay $45bn by end of year
So they'll use the new capital they raised to pay off TARP then they'll be under-capitalized again and we'll give them back the TARP money and then...LET ME OUTTA HERE!!!
We were backpacking in a national park years ago. We had pitched our tent, I had made that no food was in the tent, what we did have was suspended off the ground in a tree. I woke up in the middle of the night to a snorting, snuffling sound outside the tent. I groggedly look out through the mesh that served as a door and saw a large black bear sniffing around where we had eaten dinner. This was about 5 ft from me.
I had a .38 next to me. The following ran through my mind.
1. I could scream but that would wake up the wife who was already pissed because the trail was hilly.
2. I could fire off a shot at the bear which would just piss it off, wake up the wife, who would then be totally freaked.
3. Or I could go back to sleep and let the bear sniff all it wanted.
I went with 3. If it had been Montana and a grizzly things might have been different. Then again you would need a cannon for a grizzly and firing anything off inside a tent is hard on the hearing.
Over a Quadrillion in derivatives ...
5% of the co-parties go bellyup ...
50 trillion in losses ...
Rob Dawg (homepage, profile) wrote on Wed, 5/20/2009 - 11:40 pm
splat (profile) wrote on Wed, 5/20/2009 - 4:38 pm
reply ignore user
sigh another day.. another bailout...
I'd be happy with just one a day...
Then, we would have to have two bailouts the next day andd there would be overtime costs.
"Doesn't matter if the claims are housed in a private system like the stock market & 401Ks or public like SS."
401K's unlike pensions are controlled by the individual and if they are the least bit living in the real world understands there is a conservative way and a risky way to invest. They will also realize wall street wins and loses. Those who don't understand get taught a lesson.
The rationale for weapons in the nat'l parks is that as the economy crumbles people will seek refuge there -- running water, etc. Since it is impossible to prevent people from bringing their weapons into the parks, it is best to allow them to bring them in, rather than criminalize them (victims of bankster/government greed and stupidity). Does that make sense? Ha, ha, ha.
It's my suspicion that TPTB (via the PPT) are goosing the stock market up precisely because of the pension funds teetering on the brink of insolvency.
The Law of Unintended Consequences will no doubt come into play....
No, the reason is that it has dark and scary woods. With monster like creatures and evil raptists, meth labs, and German tourists.
" Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 4:48 pm
401K's unlike pensions are controlled by the individual and if they are the least bit living in the real world understands there is a conservative way and a risky way to invest. They will also realize wall street wins and loses. Those who don't understand get taught a lesson."
um, not my company's 401K. we have zero control on where the money goes and there is no transparency. once a year the plan administrators come into our office for a presentation on all the money we lost. which is why i'm not in the plan.
thanks alybaba, that bloomberg link about birinyi made a nice addition to my pe shenanigans article.
check my updated article.
404 - PAGE NOT FOUND
this goldman guy birinyi is the one feeding crap stats to the wsj.
in todays bloomturd he says,
"The S&P 500 may jump to a record 1,700 as the economy rebounds from the
worst recession since World War II, an increase from today’s close of
903.47, said Birinyi, who spent a decade on the trading desk at Salomon
Brothers Inc. Signs the global contraction is easing have spurred a 34
percent rally by the index since it sank to a 12-year low in March. "
Birinyi Says S&P 500 May Surge 88% in Three Years (Update1) - Bloomberg.com
"um, not my company's 401K. we have zero control on where the money goes and there is no transparency. once a year the plan administrators come into our office for a presentation on all the money we lost. which is why i'm not in the plan."
Your choice to accept the position and give away control may not be wise come retirement time. No one looks out for you but you. Good luck
The taxpayers should bailout the PBGC. The taxpayers can pay themselves to retire.
I'm still up in the air on the fate of the dollar, nearer term. The banks seemed to want money badly. REITs too. I have never seen secondary offerings priced as quickly as in the last couple months. The instant the stock got high enough, the companies tried to grab as much cash as possible. Also, California has no money. GM has no money. It seems like money is the only thing no one has a lot of. People definitely hold assets claiming to be a form of money. I don't put a high probability of the Fed Gov reneging on its shorter term obligations quite yet, so right now deflation seems likely to me. I think the dollar is set up for a massive short squeeze.
unirealist,
My theory contemplates the same actors engaging in the same activity, but they are doing it to fund the hedgies so they will have cash for the PPIP.
Anyway, you'll probably enjoy this link if you are short: "Rosenberg’s back, and as bearish as ever" FT Alphaville » Blog Archive » Rosenberg’s back, and as bearish as ever
Walter Sobchak: [pulls out a gun] Smokey, my friend, you are entering a world of pain.
I didn't see Lobbyi$t's post -- I have banned him for pressing a political point of view -- but it is the height of ridiculosity to assume that all 401K participants can control their fate. I know of one that until recently didn't have any capital preservation options, like gov't bonds. They did, recently, provide a bond fund, but read the prospectus and you learn that it invests in MBSs !!!
The new National Park Service ad campaign.
Close in on Smokey the bear who smiles at the camera as he holds up an AK-47
Cue a friendly gruff voice "Rememberm only you can prevent accidental firearms discharges!"
You missed a step
Return to step 1
Not that anyone in the administration would have any interest in jeopardizing their post-Washington seat on the board of a Wall street institution, but after the TARP $$$ is repaid, if a bank screws-the-pooch a second time ( GUARANTEED TO HAPPEN ) they should be cut loose and face the harsh wind of Capitalism.
But we all know that every politically connected corporate is just too big-to-fail and you gotta save your post administration retirement plan.
"In its first five months, HOPE for Homeowners helped one family stay in its home."
....what can be said for the program? LOL.
nova (profile) wrote on Wed, 5/20/2009 - 5:03 pm
reply ignore user
The new National Park Service ad campaign.
Close in on Smokey the bear who smiles at the camera as he holds up an AK-47
Cue a friendly gruff voice "Rememberm only you can prevent accidental firearms discharges!"
Better:
"What do you think about these rights to bear arms? Punk!"
@Ben D,
But is a 401k a wise choice? To me, a 401k is basically money you've earned that you let the government attach strings to. I know there is a "tax advantage" but is it worth locking up your money to unwittingly gamble on the level of taxation over time?
Walter Sobchak: Mark it zero!
[points gun in Smokey's face]
Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 7:58 pm
Your choice to accept the position and give away control may not be wise come retirement time. No one looks out for you but you. Good luck
Like those assets won't be confiscated by the state or inflated into worthlessness by the time he retires unless he's like 60 now. I guess you could take the money on the off chance some survives til you leave the company and buy Bunds with it after you rolled it into your own account. It'll still get confiscated by the state, though.
Don't cry for me, Argentina.
If you want to shoot bear, go to Yosemite and drive up to Glacier Point. Park at a turnout with some food and bears will approach your car.
I am not sure whether bear tastes good.
EHP says,
"That's what I meant when I said they made no sense, not by any measure. At this point Birinyi could only be using proprietary data that does not believe companies earned so little. It's not misleading or deceitful. It is simply wrong"
why in the world do you always give an out to the blatant cons? it IS misleading and deceitful. you did the same thing in the overnight thread with cashonlyhousing who is onto something fishy in the GDP data.
why you shill?????
reptillian,
Not a 401K investment person. What is the difference from a IRA or Profit sharing? I was able to invest in pretty much what ever wanted. That is my point to control you destiny. As of today I have not had a down year since the Dot com bubble.
Would a glodbug's perfect world be called an AUtarky?
nova (profile) wrote
No, the reason is that it has... and German tourists.
Ahhh, you've been poolside in Mediterranean hotels then..
Just kidding, absolutely no offence to Germans meant.
-K
My retirement is quit diverse. The government can take away very little. I deal in tangible assets and little in retirement accounts. I look out for me and have been anticipating this mess for many years.
There are many German tourists in the nat'l parks. Yosemite, Death Valley and Grand Canyon I can personally vouch for. But, because they don't bring firearms into the US, it is unlikely that they'll be armed.
If you can't compete...find a Government teat!
saw a large black bear sniffing around
We have a lot of black bear in our state. Generally a harmless bunch. Unless protecting cubs, of course.
Would a glodbug's perfect world be called an AUtarky?
I believe it's called an AUristocracy.
Saw a German in a CruiseAmerica RV, with an 88 trailered on the back.
For the minarchist Kemalist obscurantist:
Comment by 1 currency now -yogi from thread 'Japan’s GDP Declines at 15.2% Annual Rate'
The problem is quite simple..
The west thought that their place in the world was entirely due to ability, even though it had a rather minuscule role in that.
They constructed more and more elaborate BS schemes, because they interpreted the wind behind their backs as their creation and right.
The only world possible, in their minds, was one in which the west was always dominant.
Now the delusion has reached it's logical end, the wind has shifted and reality is making itself apparent.
The choice is 1] go down to a third world level of existence2] make sure that the minimum standards are first world.
Logically 2] is the better choice, but delusions of dominance and knowledge prevent rational thinking.
How can those savages have a good life.. must think of excuses to stop that from happening.
Ultimately the universe does not care if you shoot yourself in the head.. or your sophisms.
"Social security and medicare are going broke shortly. Our financial system is insolvent and now our pension guarantee system is on the ropes."
From what I've read Social Security is not too badly off. It's Medicare that's the big problem.
Lobbyist Ben Dover (profile) wrote on Wed, 5/20/2009 - 8:08 pm
Not a 401K investment person. What is the difference from a IRA or Profit sharing?
Fixed menu of investments. Generally heavy emphasis on equities mutual funds.
I was able to invest in pretty much what ever wanted. That is my point to control you destiny.
You don't control your destiny with a designated retirement account. After IndyMac, the federal regulators forced on the banking system the ability to freeze and haircut any account by an arbitrary amount via software, ostensibly to provide insurance against bank runs, and some of that "national security, drug money yadda yadda" shit.
One bright morning when the money runs out, they will use that to freeze and seize all your cash and pump it into the social security trust fund as part of a "reform" that gives them a new piggy bank to rob. Hence the Argentina reference.
As of today I have not had a down year since the Dot com bubble.
Measured in what? By any reasonable anticipation of future purchasing power, you've been scalped.
Reptillian-
eating Bear- its fatty-not a thanksgiving main course..but different, thank god for ambrosia and pumpkin pie...
I am not sure whether bear tastes good.
I've had Pennsylvania black bear. Very tasty. It has a strong, gamey steak taste. Not as tangy as buffalo.
Moose isn't very good to eat. You can make a go of it in a spiced up chili though.
"I am not sure whether bear tastes good."
Nothing older than a yearling. Info from someone who used to shoot bear for his supper (not me).
Well.. bear makes a change, everyone's been eating bull for the last year.
Bear - cook throughly. Danger of trichinosis.
Looks like the House of Havesburg isn't long for the world, a different kind of wholly roaming empire...
The Dude: And, you know, he's got emotional problems, man.
Byz: You mean... beyond pacifism?
Shadow Government Statistics - Home Page
havent seen this site posted in quite some time. yousta could count on a few to tout the inflationary pressure all the way into 2008.
now, let us all embrace the dystopian deflationistas divas delevering and call AUsterity allG.
Right to bear arms?
Right to arm bears?
(the peace-loving, forked-tongued, individual freedom fighter who wants to ban unions and get rid of the lawyers in his way)
the Byz Lebowski
alybaba just scrolled up and caught this link you posted.
Wall Street Journal and Birinyi Associates are lying about P/E ratios - 26-Apr-2009 - Generational Dynamics - Web Log
just as i found!
LIARS
EHP, sorry for breaking your balls. you are far kinder than i.
So forgive me if this is covered in the 100+ comments above:
According to PBGC estimates, auto sector pensions are underfunded by about $77 billion, of which $42 billion would be guaranteed in the event of plan termination.
So how does this happen? The pension $$ that people are expecting are cut (roughly) in half?
Pensions are obviously going to be protected at all costs as long as we continue to have representative government. The cohort of voting pensioners is too large for anything else, and social stability also weighs in. What pensions can purchase is another matter.
By definition, no "too-big-to-fail" bank can ever be truly cut loose. They just want the keys to the car again, and will say anything to get them.
The make up at Untitled Document
is definitely changing fast to govt, state etc....
Wage income for workers who were lucky enough to have kept their jobs fell almost 43% between 1929 and 1933...
Whats the over/under for 07-11? how about a pool broken down to decimal points in range of 3% to 50% $10 squares. 1rst 2nd and 3rd place.. meet in Tehachapi in 2011 for bear feast with wine and spirits on Jas.....
think of the paper and ink demand when the Pre Clinton methodology is applied to the presses as the CPI goes under 1...
dollars will be shattered and thats all that matters to Mrs Watanabe....Yu must realize that interpretations of the governmental investments will not be counted against the depth of the Dubya-Hole.
If governments prints, one submits to 10-1 social leverage AUsterity measures.
JP, the fund has some money but pensioners lose $35B (and there is a formula for individual caps).
Thanks.
Any idea as to the distribution?
JP,
The auto sector numbers mentioned in your comment are not currently trusteed by the PBGC. That is just the exposure that PBGC has to the sector --- however, PBGC will likely end up taking some of those plans as various auto suppliers either fail or are bought by another party in the bankruptcies/liquidations.
The article only mentioned the unfunded liabilities for the sector so we don't know the level of plan assets. For example, if the auto sector pensions had $77 billion of assets, this would mean that there are $77+$77=$154 billion of total liabilities and $77+$42=$119 billion of liabilities guaranteed by the PBGC. In that case, pensioners would get $119/$154 = 77% of the money they were promised overall. However, each individual's situation could vary dramatically.
My credentials: former PBGC employee
Sorry I was on a tele conference with my Senator. One who seems to give a dam what the people that elected think. Very interesting voting tonight.
"Measured in what? By any reasonable anticipation of future purchasing power, you've been scalped."
If you want to use the excuse inflation then I lose. I believe there is longer term power in accumulation especially coupled with no debt. I don't play by popular rules. Ever own three personal homes? I have and now enjoy the simple life and am prepared to be one of the last standing. So consider it won't be me who takes me out it will be everybody else. My out side of government investments have a very good return and will flex with what ever happens close to total collapse. If the government comes to take away my dirt and other hard assets it is game over for all. So I have done all possible to control and determine my destiny.
JP, What PBGC guarantees (PBGC.gov)
I would also like to make one correction to CR's comments.
CR said: "Last year the PBGC voted to allow equity investments, but luckily the entire portfolio wasn't moved into equities - and they only lost $3 billion on their $56 billion asset portfolio."
PBGC already allowed equity investments before the new investment policy was announced in February 2008. However, due to the internal investigation of the former director's (Charles Millard) communications with the bidders for allocating money to private equity and real estate, the shift of assets was placed on hold, so the asset allocation you see today was in place before the announcement of the new investment policy. This eventually resulted in the hearing that was held today by the Senate special committee. It's quite possible that the new policy will never be implemented.
There was a lot of fuss over the Boston Globe article published a couple months ago about this issue, but the Boston Globe could not verify if the assets were ever shifted. Today, we received confirmation that those assets, thankfully, were not shifted.
No hat tip for me. Ever.
Think this is bad? CALPERS is teetering on the brink and not reporting their true losses. Don't think the state of California can actually afford the benefits they've agreed to. This is old but I remember seeing an update that was more damning. Hidden Pension Fiasco May Foment Another $1 Trillion Bailout - Bloomberg.com