DescentBB

...is how much my father lost this year on his 401k. I really have little else to say. I know very little about economics, but I know the 401k is most of my parent's retirement money - and most of it has gone now. I wish I knew how bad that was, but luckily I still have over forty years before the word retirement will enter my mind...

...I put this in ethics and commentary because an economic issue will most likely arouse debate (and I hope it does so I can watch)...

Well S**T! Everybody's who's got a retirement account has lost at least 25% to 35% of it's net worth, including mine, and we're having to live off of it right now and watch it shrink every day. Of course, everybody in Wall Street whines that no one is spending or buying things out there. Well, DUH! If you don't have as much money as you did before this crash, you're NOT going to spend what you don't have anymore NOW!

Don't these Wall Street guys get it? If corporations keep laying off people and exporting jobs overseas in pursuit of more and more profits, there won't be enough people to form a solid, stable middle class in the U.S. anymore to buy anything from these companies. So their sales drop off, stock prices keep falling, retirement accounts tank and no one spends the money to keep the economy going.

To add insult to injury for retirees, our stupid government monetary policy has lowered interest rates to almost zero, so you can't get income from bonds or bank savings accounts even if you wanted to get out of the Stock Market. It looks like we're in a death spiral with no way to recover. Tax cuts are not going to fix it either, especially if you don't HAVE much income to tax in the first place! Stupid politicians!

Here's my take. Republicans, quit harping on providing tax cuts for the wealthy and corporations, they're not going to spend enough to stimulate the economy and it's only going to bankrupt our government that needs to be stable, solvent and there for us right now. Democrats, quit spending like a drunken sailor and putting frivolous pork into the stimulus bills and concentrate on things that will create long lasting jobs and repair our failing infrastructure and encourage in country job creation in the U.S private sector. They also might want to consider nationalizing the failing banks, preserving solvency and clearing out the top heavy greed mongers who got us into this mess and put in some regulation to keep it from happening again in the future. Lastly, fix health care in this country, it's going to be the next major meltdown. Whether we like it or not, a single-payer, socialized health care system is the ONLY thing that will be fair to ALL, not just the rich or privileged. Obama Care is still sticking with health care for profit. As long as it stays that way, insurance companies will STILL suck up most of our health care dollars and medical costs will either bankrupt people or kill them with lack of care. I've already spent in 2 months McCain's little $5000 health credit, so his idea sucked as well.

Dakatsu wrote:..., but luckily I still have over forty years before the word retirement will enter my mind...

So start saving now - time plus compounded interest equals win.

Don’t hold your breath waiting for the stimulus package to take affect. There are two reasons why it won’t.

1. The government in its ultimate wisdom is going to do what essentially caused the problem in the first place. (spending money it has to borrow)

2. The package does nothing to address the root problem. (the housing market & lack of lending)

not to try and make this a left right thing. I recently tried to re-fi my house. I have a 755 credit score, my wife's is 795, (and for the life of me I'll never figure out how since she hasnt worked in 25+ years } but I was told that since the housing prices have dropped I didn't qualify, yet I was told that if I was in default on my loan they would have given me a re-fi at a lower rate WTF?!?!?!?!

I read the Republican ver of the stimulus would make it so Fannie and Freddie would be required to offer a re-fi and new home loans to those people who have good credit and NOT in default, at a 4% rate, they claim it would save the average home owner $500 a month. but it's doubtful that with the Democrats controlling congress that it will ever get to the floor. shame I sure could use an extra 500 a month

I lost over 60% of the value of my 401k, but I'm more worried about my grandparents, who are in their late 80s. They lost about 2/3 of the value of their stock holdings, and are having to make some big changes to keep their home, etc.

CUDA wrote:I read the Republican ver of the stimulus would make it so Fannie and Freddie would be required to offer a re-fi and new home loans to those people who have good credit and NOT in default, at a 4% rate, they claim it would save the average home owner $500 a month. but it's doubtful that with the Democrats controlling congress that it will ever get to the floor. shame I sure could use an extra 500 a month

I agree here, the Dems are not thinking about the housing crisis and those people that need loan relief now to help out in their finances. However, to remind people, in the 1980's during a previous big Stock Market downturn, home mortgage interest rates were around 12 to 13 percent! No relief came then either when WE needed it.

But THIS is sure pissing off people that think the now suddenly tightwad banks should pony up and help out in housing loan mess too. And if these banks can afford perks like this, why can't they raise interest rates on savings accounts to help older retirees that need some decent investment income to live on besides Social Security? They aren't going to get it invested in the Stock Market right now.

I was also looking at a graph of the Stock Market values since the 1900's. Take a look at the peak value before the crash and how long it took for it to regain that peak value years later. It took about 25 years, until about 1955!

http://stockcharts.com/charts/historical/djia1900.html

I remember mentioning something about 401k being a bad idea a few years ago. Everyone at work is complaining too, except me. I told them the same thing. SS, 401k..all scams.

This makes my predictions of major issues 4-4 in the last several years. I'm changing my middle name to Nostro.

tunnelcat wrote:Don't these Wall Street guys get it? If corporations keep laying off people and exporting jobs overseas in pursuit of more and more profits, there won't be enough people to form a solid, stable middle class in the U.S. anymore to buy anything from these companies. So their sales drop off, stock prices keep falling, retirement accounts tank and no one spends the money to keep the economy going.

Companies aren't moving overseas for no reason. The cost of doing business in the US isn't conducive for business.

If you want the jobs to come back, you have to make an environment for the companies that is better than where the jobs are moving to.

A good start is slashing corporate tax rates and regulations in half. If corporations can do business in the US cheaper than they can do elsewhere, they will come back.

Maybe someday….lol…people will see business for what it is and the “actual” benefit it has to our country, and stop trying to make them agents of social change instead.

Whats so different about Made in China by Chinese verses Made in America by Mexicans? Either way the profit goes to the executives and the workers salaries go to another country...

Testiculese wrote:I remember mentioning something about 401k being a bad idea a few years ago. Everyone at work is complaining too, except me. I told them the same thing. SS, 401k..all scams.

This makes my predictions of major issues 4-4 in the last several years. I'm changing my middle name to Nostro.

So, what's the answer for planning for retirement? Please don't say pensions.

I just start recently... so I haven't lost that much as a figure, but my balance is less than the amount that I've contributed.... it's kinda sad to think that if I'd stuffed the money under mattress I'd be ahead of where I am right now.

The trouble with corporations is that they have no allegiance to any one country. They could care less about supporting a nation and it's workers. They'll go where the taxes are low, the labor is cheap and the local government's friendly to their way of doing business. The trouble with Americans is that they seem to gravitate toward buying 'cheap' goods instead of 'quality' goods and perpetuating the corporate addiction to cheap labor. I saw on CNN the mayor of Lansing MI railing on to Congress about the cheap goods poring into the U.S. and undermining our manufacturing ability and all our illustrious Senators could say to him was that Americans needed these 'cheap goods' in these troubled times. Well crap, if we don't have jobs, we won't be able to afford even 'cheap goods' from Walmart. Idiots!

Meanwhile, the CEO to worker salary pay imbalance has grown dramatically since Reagan's tenure as President . OINK OINK fat piggies!

http://www.epi.org/economic_snapshots/e ... _20060621/

I seriously doubt that lowering corporate taxes in the U.S. will bring corporations back here to manufacture goods. They are hooked on the almost slave labor that China, Mexico and other third-world countries supply. How many Americans would even work for the same wages that Chinese or Mexican workers get, let alone be able to live on those wages in this country.

I own two American cars, one an 1988 Jeep and the other a 2002 Chrysler. The Jeep was made in Canada back then of all places and the Chrysler was made in Mexico. So much for 'American made'. I wasn't even shopping for a cheap price when I bought either car and I would have gladly paid the price for American-made cars to support our own U.S. workers. I thought that in 1988, the Jeep would have at least been made in the U.S., but not so.

Mark me down for about -50k... livin the dream.

I never did 401k for this very reason. (that and I fully expect Christ to return befor I hit 70) That and it's based on a subclause of a law, it could be changed at any time.

I'm sorry to hear you guys lost so much. Everyone at my job is in the same boat.

Duper wrote:I never did 401k for this very reason. (that and I fully expect Christ to return befor I hit 70) That and it's based on a subclause of a law, it could be changed at any time.

I'm sorry to hear you guys lost so much. Everyone at my job is in the same boat.

Well, it was take it or leave it. Not much of a choice there.

VonVulcan wrote:

Duper wrote:I never did 401k for this very reason. (that and I fully expect Christ to return befor I hit 70) That and it's based on a subclause of a law, it could be changed at any time.

I'm sorry to hear you guys lost so much. Everyone at my job is in the same boat.

Well, it was take it or leave it. Not much of a choice there.

well yeah. That's normally the choice.

Some places will match funds or percentage, but I've yet to see a company that will finance a 401 without you puting any money into it first.

Then you have now seen it. They put in 7% (was 9% when they started) of years previous gross without you putting in a dime, you can put in as much as you want up to the max allowed. Or nothing. Not a bad plan considering. But it was the only choice. Now it's not so good...

Duper wrote:Some places will match funds or percentage, ...

Indeed, that is one of the great advantages, of at least some plans. My company has a dollar for dollar match up to 7% of employee contributions. This is free money - an instant gain on whatever you've invested.

check out the Bloomberg Calculator.

Of course it helps when the market is going up. I'm betting that it will (again).

We get up to 4% depending on the Corp's GPM.

Welcome to the club. My folks won't be retiring anytime soon.

I bury my retirement fund somewhere in the mountains. Needless to say Jesus' parable about the good servant wasn't told in a poor economy, 'cause all the suckers that told me I should invest it are all out fifty G's.