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Social Security Information Systems Near Collapse
matty619 writes "An Information Week article warns that the computer systems that run the Social Security Administration may collapse by 2012 due to increased workload, and a half-billion-dollar upgrade won't be ready until 2015. One of the biggest problems is the agency's transition to a new data center, according to a report (PDF) by the SSA's Inspector General. The IG has characterized the replacement of the SSA's National Computer Center — built in 1979 — as the SSA's 'primary IT investment' in the next few years."
So the world will end in 2012!
Chaos maximizes locally around me.
this is a very light system. (no, it doesn't have millions of users.)
Half a billion dollars? Are you fucking kidding me?! No wonder the program has failed and is such a joke. And we're looking to find a way to keep this program afloat well into the future, to "protect" us in our retirement by siphoning off extra taxation from every paycheck for our entire life? The same guys who are spending $500,000,000.00 to upgrade the system that maintains it? You could buy a million iPads at retail price for that. I don't know why you would, but you could. Holy fuck.
Then again, a lot of it is written in COBOL, as the article states. And as our unqualified, ignorant, idiotic National CIO stated last year -- something like this, anyway -- "we need to improve the computer human interface with skip-logic, because a lot of things are in COBOL binary interface". Or something.
Oh, and note that the article said that half a billion dollars is just what has been allocated for the project. So far. How much longer are these guys going to get away with these twenty million dollar Drupal *.gov website projects and other scams?!
Half a Billion? Years? a crack team of 2 dozen professional data thieves would pull and squeeze every ounce of data out of that system in matter of days and probably with out a single restart to the mainframe. and would sell it back to you for pennies a person. $10 million tops.
Just use facebook ID's instead.
If you mod me down the terrorists will have won
In a related story, it has been reported that top officials at the Social Security Administration are prepared to reduced the entire Social Security System to a Web App and run it on the Amazon Cloud.
Why there is no money in SS to distribute...
So, piss away another half billion. Who gives a shit?
This is sick. The three physical costs of S.S. as I can see it:
1) Data acquisition (who has incrementally paid into the system) - this is B.S. accounting because it's all going to come from the general tax fund soon anyway, so why the charade?
2) Call centers - (this is for old people after all)
3) Printing checks
The rest can be handled by less than a million dollars in hardware / software.
3 can be outsourced (paychex doesn't overburdern my company with overhead as far as I know).
2 can be outsourced and them some
1 as I already alluded to is the fault of congress, and is largely unnecessary. You have to double the efforts of the IRS to make sure payments are correct. You have to audit, you have to make multiple transfers of small orders of money. You need financial advisors (who purchase US treasuriers with the surpluses), bla bla bla.. All simplified by simply being part of the general tax fund and withdrawing directly from US treasury.
A hadoop system can trivially destroy 300 million pieces of data in less than an hour - I don't care what language it's written in. This incremental B.S. thinking is pervasive in all forms of government and just needs to be viserally reacted to by the voting public. A company that's not in the black that needs a $500M investment to 'keep afloat' for crap like this would go out of business and be replaced from scratch. Dead is a powerful natural tool. It needs to be applied here.
-Michael
I was thinking the same thing - and it would be funny if I wasn't one of the ones left holding the bag of crap
Half a billion dollars? Are you fucking kidding me?! No wonder the program has failed and is such a joke. And we're looking to find a way to keep this program afloat well into the future, to "protect" us in our retirement by siphoning off extra taxation from every paycheck for our entire life? The same guys who are spending $500,000,000.00 to upgrade the system that maintains it? You could buy a million iPads at retail price for that. I don't know why you would, but you could. Holy fuck.
I like bashing expensive government projects as much as the next guy, but if you are creating a nation wide IT system of any kind for a nation of 300+ million people $500,000,000.00 it doesn't sound too far off. Hell, Apple just sank $1 billion into a datacenter and Google sank $600 million into a datacenter in Berkeley, South Carolina and that one is just one of their many data centers. People love to take the total costs for a project like this and shout: "SCANDAL! $500,000,000.00 spent on failed IT project". Nobody mentions that the investment in a data center is largely recoverable since it and it's hardware can easily be repurposed. It's only development and training costs that are wasted which is bad enough but still only a fraction of the costs. The main scandal here is not so much the cost of, its the fact that they will run out of capacity before the new datacenter is ready. As for COBOL being a dying language COBOL is in good company on death row along with C, C++, OpenGL, BSD (and UNIX in general) plus a number of other things IT that have been labeled as "dying" almost as long as I have been in the IT business which is longer than I care to remember. The claim " is dying!" is a long time IT gutter-press favorite.
What does it look like for a computer system to "collapse?" Suddenly no longer able to process a single transaction?
It is only a ponzi scheme now because Congress continually increased the number of straws sucking money out of the system. All they need do is increase the age at which you can withdraw benefits. Unless of course you think a society should send all its blue hairs out to the desert to die away from everyone else.
It's not a Ponzi scheme since there are viable alternatives for keeping the system solvent until the boomers are mostly dead. It's only a Ponzi scheme if it's impossible for it to be sustained. It isn't. You may not like the choices, but there are choices.
But you aren't doing that. You're investing in special treasuries (with non-standard payout rules). 140 m workers investing in the productive capacity of the economy instead of loaning money to the government could very well have much better performance. Of course you could choose to buy treasuries anyway...
It's not a Ponzi scheme since there are viable alternatives for keeping the system solvent until the boomers are mostly dead. It's only a Ponzi scheme if it's impossible for it to be sustained. It isn't. You may not like the choices, but there are choices.
"A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors, not from any actual profit earned by the organization, but from their own money or money paid by subsequent investors." [source] Just saying...
The real litigious bastards...
While Heinlein was full of all sorts of products of his generation, and I don't ascribe to everything he has said, one of the things he wrote has always struck me:
"He felt that democracy was a very good system, for beginners."
That quote was from an alien that oversaw 3 galaxies and had a political system far beyond what even Heinlein was willing to describe.
Now, everyone is going to take something away from that quote but what I take away from it is that we should not be so static in our system of governance. Our system while a lot better than most is not above a better system that could be drafted for this age. And then that system will be eclipsed by another system that fits that age better.
Sadly, it takes blood and tears to make these changes. One day we might know better. One day.
Really, I know what I'm doing...Ohhhh, look at the shiny buttons!
No, that's a stupid way to fix the system.
The actual way to fix the system is to raise or even remove the income cap.
Or just raising rates by 2% or whatever. Or means testing.
Idiots looking at the social security system and claiming it's about to be 'broke' and we should give up on it are like idiots looking at a gas gauge in a bus and claiming we're almost out of gas so we should get out and walk.
We're only going to run out of gas only if morons repeating over and over 'social security is broke' actually manage to elect enough navigators to keep us from stopping at a fucking gas station and buying more gas.
The rich, in this analogy, own a taxi service, aka, the stock market, where they wish people would spend their money instead.
Rich people: 'Social security is broken because there's a very minor problem with it that will cause issues in a few decades, we should get rid of it.' Young people: 'I heard that people think social security won't be there when we retire, so I'm all for doing away with it.' Chorus: 'Social security is going to die because we're going to kill it, so we should kill it.'
It's the most goddamn absurd attempt at a self-fulfilling prophesy I've ever seen. And the real joke is that everyone desperately wants people to forget the alternative was 'letting people invest in the stock market', so if we'd actually privatized social security back when Bush wanted to it, we'd have lost all that money. And if, instead, we'd have invested in 'safe' bonds and stuff...we'd still have lost that money, because the damn bond rating places were criminally asleep at the wheel the last decade and giving perfect ratings to utter shit packages of loans.
So now, hilariously, no one actually mentions where we'd invest this retirement money instead of social security. They're going to wait a decade and then start pimping giving it to the rich, um, I mean, investing in the stock market, and hope we forget what happened this last decade.
So, the next time you hear an idiot talk about 'private retirement accounts', ask them what you think we should let people invest in. And then pretend they started invest in that in 2000, and see how well the market did.
If corporations are people, aren't stockholders guilty of slavery?
The Social Security Administration and IRS are two civilian govt. agencies that bought into computing early (1960's or even before). Part of this upgrade is like the FBI's situation of 10 years or so ago. Under USA PATRIOT, they have to work with a whole bunch of other agencies that are all built around more modern gear (Homeland Security mandates SSA can send data seamlessly to Border Security, FEMA, DEA and others, who don't know COBOL from Commander Adama's dog). Soc. Sec. now has to be able to verify to other agencies, not just that a name and number match, but that the number was issued as "valid for employment" (As opposed to numbers issued as part of some student only visas and such). This mandate comes from HSA, and yet the funding is carried on SSA's books. That way, the public (especially on the right) complains more about how civilian agency costs are too high, and doesn't see it as part of the Police Agency section of the budget.
Who is John Cabal?
(Doubling up here for the quoted part)
1 . For every person who swears they could make a lot more investing their money themselves there are 2 or 3 who try it and fail, and 2 or 3 more who keep meaning to get around to it but don't ever get their act together. Maybe the parent could really do it, maybe he's smarter and more self disciplined than a lot of other people who have made the same boast, but statistically, he's way wrong.
2. If he's paying on 8 months, that's about an 8.3% rate, compared to the poorest workers making only 10 or 20 K a year, who are paying 12.5%. He's complaining about being taxed at a lower rate than the poorest people who have a job at all. Whaaaaahhhhhh! Tell, me, I'm 6''5", 250 lbs can bench press 480 (Kilos), and personally kicked Bruce Lee's, John Claude van Damme's and Chuck Norris' asses at the same time, beating them severely with Kurt Russell in his Snake Pliskin suit, and I own my own nuclear weapons for defense, so why do as much of my taxes go for police protection as some fat neckbeard's (Disclaimer: Not really, on any of that - Disclamer 2: If you did somehow believe all that BS, I also want to sell a nice bridge cheap, you'll make loads of money.). Oh, and I come from a very long lived family, why aren't my insurance rates lower than everyone else's? I do better work than any of my coworkers, why am I in the same paygrade? Whaaaaahhhhh!!!!!!
Who is John Cabal?
140 m workers investing in the productive capacity of the economy...
Don't worry, they could have invested in their house, and lived on reverse mortgages...oh, shit, wait, the value of their house just plummeted and no one's giving out reverse mortgages anymore, are they?
They could have invested in bonds instead. I'm sure the bond-rating agencies weren't just rubber-stamping A++ rating on shitty bonds backed by bad mortgages...no, wait, they were, weren't they?
Do you 'privatize social security' idiots not actually pay attention to the actual news?
Please list anything that someone investing in 'the productive capacity of the economy' could have started investing in 2000 and made money. (No, you don't get to retroactively pick specific companies, but you can pick something like the Dow...although that specially, obviously, is not a good idea.)
It doesn't have to 'make money' every year, but it needs to somewhat predictably increase and never ever plummet, because people will be living off it. Come on, it's got to be somewhere around 4% to beat social security, and let's say it can't ever drop by more than 5% over a year. Please point to it.
Oh, and you don't get to use government bonds. Using government bonds is just having the government pay for it in a slightly stranger way. Duh. Saying 'The government shouldn't be handling retirement, instead, people should loan the government money and live off the interest that the government provides' is utterly surreal, especially from a group of people who uniformly want the government to stop borrowing and live with its mean.
This, of course, doesn't address the problem of some people living to 100 and hence running out of money in their account. I guess we can be charitably and assume that the system just assumes people will pay their own way until age 90 or whatever, and then the government will just cover the few remaining people, but that is going to cost at least some money.
And it's also failing to address the fact that if everyone invested, it would entirely distort the market. If everyone invested in the stock market, well, it would be a very different stock market. if everyone bought bonds the demand for bonds would stay high, which would result in people issuing lower-rate bonds to cover the market. But first let's see if you can find somewhere to invest in the first place, and then we can look at what 140 million people investing in that market would do.
If corporations are people, aren't stockholders guilty of slavery?
You're offering only part of what defines a Ponzi scheme. Using that very brief and incomplete definition, most of what people invest their money in for retirement is a Ponzi scheme. Let's consider some other characteristics that define a Ponzi scheme.
Ponzi schemes offer large short term returns that are abnormally high or consistent. Social security doesn't.
Ponzi schemes require an ever increasing amount of money to continue paying off past investors. Social security has a temporary problem from the large number of boomers, but social security can be, and has been, modified in the past to reflect changes in the size of the taxpaying workforce and the number of beneficiaries. Once the boomer bump is over social security will stabilize.
Ponzi schemes don't reveal the method by which they generate their great short term results. Social security is transparent as to where the money is coming from, where it's invested and who receives benefits. It's what it claims to be, a mandatory transfer payment system under which current workers are taxed on their income, with no promise of huge payouts.
Ponzi schemes typically don't invest any of the money people invest in it. Money paid into social security is invested in U. S. government securities. Social security owns trillions of dollars of US securities. Social security owns more US government securities than China.
There have to be productive places in the economy in which to invest it. The world was awash in liquidity in 2005 looking for a place to be invested. It found one. US mortgage backed securities. Or maybe all that money could have been invested in the very productive tech stock bubble of the late 1990s. US corporations are sitting on over $1 trillion looking for a productive place to invest it. If you added all the money paid into social security to that pile I'm not sure it would be any more productive. In the end, though, don't you end up with a different version of the same problem social security is facing? If the boomers own trillions and trillions of dollars worth of investments, who's going to buy all those investments from them so they can get their money back?
BZZZZT, that was not an answer to the question I posed asking where people should have their money instead of social security.
Please try again.
If corporations are people, aren't stockholders guilty of slavery?
You could run this on a couple of Intel servers and a big RAID.
The managers are the problem but in the government, even tho Congress tries to blame the bureaucrats, it is the waffling and micromgmt of congress critters that causes the issue.
For example, the Dept of Homeland Security consists of 22 Agencies that report to 88 Congressional Subcommittees. Not sure how many different congress critters have interfered with SSA or directly with the spending on computers but I'll bet that's where the 'management problem' lies.
Well, a bit more than a typo but:
Ideally char would become a reserved word, and current usage be preserved by a temporary waiver that allowed "char" to be made equivalent to the new byte type.
changes to:
Ideally char would become a reserved word, and current usage be preserved by a temporary waiver that allowed a macro for "char" to be made equivalent to the new byte type.
I think we've pushed this "anyone can grow up to be president" thing too far.
Just compile COBOL to .NET byte code and throw it on Windows Azure. Problem solved. Next!
Money paid into social security is invested in U. S. government securities.
This is perhaps the most underhanded aspect of the whole scheme. With very few exceptions, income from U.S. government securities is spent on current consumption, not investment. The principle and interest are paid back with future tax income, which comes from—you guessed it—the same people paying into Social Security. So these "investors" are paying not only the original S.S. income tax, but also the principle and interest to pay back the "loans" S.S. makes to the rest of the government. Even assuming the principle part balances out (in lieu of additional taxes elsewhere, with spending remaining constant), that still leaves them paying their own interest on top of the regular S.S. income tax.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
This strikes me as a task comparable to the Y2K crisis, which was handled well enough that the vast majority of the sheeple believe it to have been a scam, a tremendous waste of time, money, and urgency that was all for naught.
Nothing could be further from the truth.
The major differences between this and the Y2K crisis is that the politically-dominated government, and not profit-minded enterprises, is responsible for dealing with the problem. And so we are likely to see government gridlock drive us straight into a collapse of the system that would have been paying out a huge chunk of the spending money to just about the largest demographic group in the country -- those age 60-something-and-over, with the resultant impact on the economy triggering an economic crisis that will be truly stupendous to behold.
Consider the alternative: an economy that is strapped for reasonable-paying jobs, hires a bunch of the near-retiring or retired boomer coders, delaying their retirements and generating additional cash flows into the economy. We get a smooth transition to a SS system (hardware and software) that is capable up supporting the huge demographic bubble of the boomers, that also happens to lessen the impact of an abrupt boomer retirement. This covers more than mere coders, as the planning and logistics and setup of a number of fault-tolerant fail-over capable data centers employs a lot more than just coders and analysts.
And Obama says he can't find any "shovel-ready" jobs.
(Doubling up here for the quoted part)
1 . For every person who swears they could make a lot more investing their money themselves there are 2 or 3 who try it and fail, and 2 or 3 more who keep meaning to get around to it but don't ever get their act together. Maybe the parent could really do it, maybe he's smarter and more self disciplined than a lot of other people who have made the same boast, but statistically, he's way wrong.
Most of us just get a 401K account, or a TSP if you're military / government. People can easily get 10% rate of return, and doing that over 30 years you can pile up a good amount of money, and if you shovel it into bonds towards the end you're not likely to lose it.
According to this calculator, which is based on historical data, the rates of return for SS are miserable. Even if you left your money in bonds the whole time you could beat SS.
It's not a Ponzi scheme since there are viable alternatives for keeping the system solvent until the boomers are mostly dead. It's only a Ponzi scheme if it's impossible for it to be sustained. It isn't. You may not like the choices, but there are choices.
So, viable alternative #1, cutting benefits, instead of a conman telling you "you're screwed, you're not getting your money back" it's the government telling you that.
And with viable alternative #2, increasing taxes, instead the whole thing falling apart when the con is discovered, the government says, "you're going to continue paying and you'll pay more, or you can have no income or you can go to jail."
It's definitely not a Ponzi scheme, that's for sure.
From http://www.cbpp.org/cms/index.cfm?fa=view&id=1648 :
Simple rate-of-return comparisons such as those Glassman and many other individual-accounts proponents use fail to take into account the costs of continuing to pay for the benefits of current beneficiaries (and the benefits that current workers have accrued) when computing rates of returns for individual accounts, while including these costs in the rate of return computed for Social Security. These costs remain, however, even if Social Security is eliminated for new workers and replaced entirely by individual accounts. As a result, such comparisons are inherently biased. Since the payments to current beneficiaries (and the benefits that current workers have accrued) are not avoided by setting up individual accounts, the returns on individual accounts should not be artificially inflated by excluding the cost of these payments.
In other words, we have the obligation to pay for people who don't have 401ks yet.
Also, 10% earnings is unrealistically optimistic! I just looked up my Vanguard accounts, and over 10 years, 5% is more typical. And, *then*, you have to subtract off inflation. In the real world (vs. one's dreams) one has to settle for about 3% yield over inflation.
So, sorry, parent post. You're all wrong.
How did they go broke in 2008? I owned stocks in 2008, they are worth more today then they were then.
Yes the bond-rating agencies were being fraud, still anyone who bothered to look could see that real estate was in a bubble and avoid those.
Even if you didn't avoid those, again they don't make up 100% of your holdings.
Yes people who are retiring int the short to medium term shouldn't have all their money in long term investment vehicles - that's not even common sense, that's just not being retarded.
OK.
The DOW.
Let's say it's $10,000 a year (the number doesn't matter since you can just multiply anyway).
And you are a spectucalarly stupid investor who buys all $10,000 on one day and that day always happens to be the highest day for the DOW that year.
So how does your investment perform (total is how many DJIA "units" we own in total):
year: 2000, DJIA: 11722.98, total: 0.85
year 2001, DJIA: 11337.92, total: 1.74
year 2002, DJIA: 10635.25, total: 2.68
year 2003, DJIA: 10453.92, total: 3.63
year 2004, DJIA: 10854.54, total: 4.55
year 2005, DJIA: 10940.55, total: 5.47
year 2006, DJIA: 12510.57, total: 6.27
year 2007, DJIA: 14164.53, total: 6.97
year 2008, DJIA: 13058.20, total: 7.74
year 2009, DJIA: 10548.51, total: 8.69
year 2010, DJIA: 11585.38, total: 9.55
The DJIA closed at 11,674.76 last week, so our investment is worth $111,487.51. So basically unchanged (up $1,487.51 over what we invested), with the absolutly worst case investment plan (buy the yearly high).
But of course we've been earning dividends as well (though admitedly since the DJIA isn't very "I" anymore it's not really the place to be seeking dividends). Of course the DJIA is currently amazingly overvalued and propped up by the Fed yet again, hence low dividends and a pretty good chance of a big drop again.
That's just a stupid requirement. In the first half of my working life I don't give care if it goes down by 50% one day, as long as it comes back up. When I'm actually retiring I likely have it all in bonds anyway - essentially what SS is 100% government bonds. Being able to have more swings early on is verry useful.
And yes I could lose it all. Not having low income pensions/etc funded by general revenue (i.e. not a promise to people to magically invest their money and payouts to the rich because they paid in as well) would be a bad combination.
And the DOW is a pretty stupid place to put your money - though note that your "obviously, is not a good idea" place is actually up over that timeframe (hooray for inflation).
If you're healthy, behave in a healthy manner, and have good heredity, you're a fool to buy insurance.
Basically, there are only three reasons to buy insurance. 1) You know something the insurance company doesn't (so you're out to defraud it). 2) You're being forced to buy insurance. 3) You're a coward.
Contribute to civilization: ari.aynrand.org/donate
Sooooooo inclined to agree with you! ...but ultimately I'd buy into a Ponzi scheme if I could get payout with very little or no investment, which is what our SSI allows. So not ponzi.
It is NOT collapsing. Our mainframe is chugging along happy as ever. We are virtualizing servers to free up space and reduce power consumption. Gov't IT is not perfect by any means, but I think this is a ploy to make sure no one cuts our budget.
The DJIA closed at 11,674.76 last week, so our investment is worth $111,487.51. So basically unchanged (up $1,487.51 over what we invested), with the absolutly worst case investment plan (buy the yearly high).
Fencepost error. You invested eleven years in there. You invested in 2000, and in 2010, and all the years in the middle. That's 11 deposits of $10000, which is $110,000 invested.
You got a return of $1487, which is under 0.3% interest rate. (Technically, I don't know what day you started, so the investment could have been slightly longer than 10 years, or slightly short than 11, or somewhere in the middle, so the rate varies.)
Inflation, meanwhile, was 3.8% over that period. The DOW: Doing ten times worse than inflation. Put all your money in it tomorrow!
Yes the bond-rating agencies were being fraud, still anyone who bothered to look could see that real estate was in a bubble and avoid those.
If only we had some third party agencies that would rate bonds to make sure that they were reasonable investments...oh, FUCK.
Sorry, you lose that argument. People can't do an infinite amount of research on bonds. They're bonds, not stocks. You're not supposed to have to do research to weed out obviously bogus ones. You're supposed to pick your level of risk and go with AA+ or BB, end of story.
Just like you don't get to specify individual stocks, you don't get to specify individual bonds either. The retirement plan you think people should be using has to be automatic, not having people do research every month to figure out where to invest. A computer must be able to do it.
If people can do it wrong because of lack of research and lose all their money, your plan is broken.
Now, if you want to specify only specific types of bonds, like government or commercial real estate, feel free...but you don't get to exclude mortgage backed bonds retroactively solely because that specific market blew up. That's cheating.
So you're an idiot? Obviously government bonds would be part of almost any investment strategy.
If the government provides for retirement, it provides for retirement.
Everyone saying 'We should invest ourselves, not have SS' and then expecting to able to buy nice safe government bonds are actually expecting the government to provide for their retirement...they just don't want the government to provide for other people's retirement.
It's especially ironic as half the idiots wanting to phase out social security claim to be 'deficit hawks' who, if they actually wanted to reduce the deficit, would, you know, be wanting less bonds issued. Instead they want to loan the government money and live off it later at nice high interest rates in a way that only they participate in, as opposed to a standardize government program.(1)
I have nothing against investing in government bonds in the actual real world, but it's the height of dishonesty to assert that social security is a bad idea, and everyone should purchase government bonds instead.
I really don't get why it has to be SS or nothing?
It's not SS or nothing. You can invest additionally wherever you want.
But in the actual world, where 90% of Americans live and work, they do not actually make enough to invest anywhere. They'll have some medical expense or some layoff or lose their house because the bank committed fraud when it sold them to them and then use their retirement principle to recover from that, or declare bankrupcy and lose it anyway, and never managed to recover any savings.
All the people who think we should put the base level of retirement, the thing that keeps people from staving in the streets, in a place where people can access it, have never been in a situation where people actually have no money, and, would, you know, use that money instead if they could get to it. (Of course, no one's been in that circumstances, as we don't let people wipe out their SS money.)
Of course, yo
If corporations are people, aren't stockholders guilty of slavery?
Which is exactly what I said. Did you just not bother reading?
I also covered that. You know "dividends" and "this is the worst case most pathologic strategy possible over your cherry picked bad timing period".
No but surely you can say "not all the same bonds" and not "new fancy complicated bonds". Treasuries, munis, and corporate bonds ratios dependant on how far away retirement is and current prices. Not whatever fancy new shit wall street thought up this week.
The money they currently pay into social security would be required to be invested, obviously enough.
But clearly you don't actually bother reading what other people write and have already made up your mind, so there's no point discussing futher (since I'd just be repeating what I've already written). Here's a hint: I'm not American, I'm from a country with both forced retirement savings in personal accounts and government pensions for those that need them. Amazingly enough the elderly aren't starving in the streets.
GOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOLD! Only Gold can SAVE US NOW!
Seriously, you know what would a fuckload better than stupid gold in an actual economic collapse?
Some sort of power generator, preferably a renewable one. As an added bonus, you don't have to wait until then to use it. I'm sure the people who actually were smart enough to get those would be willing to trade the power for lumps of metal they can't do anything with. Or not.
Hell, the Boy Scout Handbook will, literally, be worth its weight in gold. When makes the gold a pretty dumb investment instead of just buying the book.
Not that I do think there's going to be any sort of 'collapse' (Although I think the bank problems are just getting started.), but it's very telling what sort of stupid shit people think is important.
I bet 90% of the gold hoarding morons don't even have a plan to get drinkable water if everything blows up. Or own a hand-cranked battery charger. I wonder how many of them realize you need water to grow these 'seeds' they have? Seeds in quotes because they probably are all dead.
Remember when survivalism used to be done by people who were paranoid, yes, but who were smart and well prepared? They'd have basement stocked with canned goods and generators and supplies of gasoline that they'd carefully top off? With rows of car batteries and a hand crank in case the gas ran out? Remember those guys? (I'm sure they're still out there.)
Sure, they were classic example of 'craziness is taking an incorrect premise to the logical ends', but at least you could fucking respect those guys and they got starring roles in apocalyptic stories.
Instead we now get paranoid people who are idiots who think you, apparently, can live off gold.
If corporations are people, aren't stockholders guilty of slavery?
Which is exactly what I said. Did you just not bother reading?
I misread that, because it didn't occur to me that you though a return of $1400 over 11 years was useful! I've make that much interest on my checking account.
I also covered that. You know "dividends"...
Except that dividends on the Dow are, um, about 1.4%.
You know, worse than one year CDs.
Even combining that with the 0.3% interest rate, you can invest in five year CDs and make more. Granted, not over 10 years at a $10,000 a year..but you could probably come out even by investing in the longest possible CD that would be done at the limit each year, with 10, 7, 5, etc as time goes by.
I point to the actual change in value: 2009: 11722.98, 2010: 11585.38.
It doesn't matter 'when' the sells happen, it matters that the Dow went down.
Yes, if you were a day trader, you could have made money. That doesn't change anything. People are supposed to be regularly investing via some sort of plan, not day trading the Dow.
over your cherry picked bad timing period".
Ah, yes, the check-picked time period that just happened. Would you rather I use 1960 to 1970? Or 1970 to 1980? Did you know a dollar invested in 1966 and taken out in 1982 would be worth 33 cents after inflation? You're the one trying to cherry pick times.
And you're wrong. The pathological worse time period would be from 2000-2009.
But let's not use the worse case scenarios. I would take the first day of the year, but that day is weird for the market. So let's do it fair and roll a dice for the day to invest. The first year Dow was 11722 for a random value, and 11722 mod 365 is 42. (Seriously? 42?) The 42th day of the year is, what, February 11?
Everyone invested 10,000 on Feb 11, starting in 2000 and moving it to some other account (bonds?) in Feb 11, 2010. (Thank goodness they didn't move it in Feb 11 2009.)
Treasuries, munis, and corporate bonds ratios dependant on how far away retirement is and current prices.
You do realize that muni bonds are threatened now, right? Because so many local governments are bankrupt? And the Republicans want to repeal the law disallowing state governments from declaring bankrupcy, so even state bonds are in danger? (Local governments can or can't, depending on the state, but states can't.)
And I will again point out that investing in government bonds is just a roundabout and insane way of the government providing retirement, instead, you know, actually having payouts indexed to things like social security. It provides no discernible benefit to anyone.
So you've left corporate bonds...rated by the same bond rating industry we've discovered does nothing at all.
I'm not American, I'm from a country with both forced retirement savings in personal accounts and government pensions for those that need them.
You keep using the phrase 'government pensions'. I don't think you know what that means in the US, or you don't know what social security is.
Pensions, in America, are things employers provide. Employers include 'the government', but no one gets a 'government pension' if they didn't work for the government.
Government 'pensions' in other places, from what I understand, are essentially an account that people pay into through taxes and collect later. This is what social security is. We just do not call it a 'pension'. We call it 'insurance' for some utterly inexplicably reason.
Granted, you said 'if they need it', which is what we mean by 'means testing', giving it only to people who have no retirement income (aka, a pension) from previous employers. We don't currently do that for social security, but has been proposed as one of the fixes. (We don't do it mainly because almost no one gets any sort of retirement pension anymore, so it's a lot of work to means test for almost no net gain.)
If corporations are people, aren't stockholders guilty of slavery?
Why not point to the actual change of 2009: 6,547.05, 2010: 11585.38?
yes the stock market is a stupid place to invest if you buy 100% of your holding at one random point in time, and sell it all at one other random point in time.
You just don't read. Pathalogical refered to the buying strategy not the time frame.
You have the completely wrong understanding. I already described how they actually work. But again you don't read.
I'm done. You win. And all you had to do was not read anything I wrote.
Why not point to the actual change of 2009: 6,547.05, 2010: 11585.38?
Which is great for all the money you invested in 2009.
Not great all for the money invested in the previous 20 years if you needed it in 2009.
yes the stock market is a stupid place to invest if you buy 100% of your holding at one random point in time, and sell it all at one other random point in time.
Which is how any sort of required investments work.
You have the completely wrong understanding. I already described how they actually work. But again you don't read.
No, I explained that you used the word 'government pension' to talk about some sort of thing that the poor elderly can get, and I politely pointed out you're using the wrong term and no one in America knows what you're talking about, because only government employees can earn government pensions, so it hardly works as some sort of national solution.
That is only a 'win' if you're an idiot.
If corporations are people, aren't stockholders guilty of slavery?
I never thought I would hear it, 1979, and still running, wow, just that is a feat in itself, and the immense stupidity for not thinking ahead is another...
No "required investment" that I have ever heard of reauires you to buy 100% of your holding at one point in time and then sell them all at once.
They usually have you buying every month or every two weeks depending on how often you get paid. And have you selling in a slowly increasing rate after you retire. But of course since you don't have such a system you know the system I've worked under and my parents have retired under much better than me.
How buying small amounts every month for 50 years, and selling small amounts every month for 30 years could possibly be thought of as all at onec I'll never understand.
Yes "government pension" means something else to Americans, that's why I tried to point out the difference between it and social security, which you ignored.
But as I said, you win. I'm not interested in arhguing about definitions.
Those of us in more enlightened countries will just continue with our moderate combination system that actually works. You can keep your wierd "pay billionares more than you pay the penniless" system.