buy gold; even better rare coins!!!!!!! as usa on brink of..........???

[michael]

Is the U.S. on the Brink of an Unprecedented Financial Crisis?

By Patrick A. Heller, Market Update

July 01, 2008

 

 

 

from NumisMaster website

 

 

 

In the past week, the economic news has been horrible.

 

" The Dow Jones Industrial Average first broke down through the 12,000 level that had been vigorously supported by indirect U.S. government manipulation for months. Then it quickly fell below 11,722, its year 2000 peak level, the next major psychological resistance point. Now it is significantly below that level.

 

" Major U.S. banks and brokerage firms have been turning the knives on each other, calling for their clientele to avoid investments of the other firms out of fear of major imminent revelations of huge losses.

 

" The Royal Bank of Scotland, Barclay Capital, and Fortis Bank have been predicting an imminent crash in the U.S. stock markets. Actually, RBS said it may take until September and may only see stock prices fall 25 percent. Over the weekend, Guido Lippens, the chairman of Fortis Bank, predicted a major financial collapse in the U.S. within a few weeks, including bankruptcies of 6,000 regional banks and many major companies (specifically naming Citigroup and General Motors).

 

When the Federal Reserve Open Market Committee met last Tuesday and Wednesday, it basically did nothing. Several analysts are taking this lack of action as a sign that the Federal Reserve has exhausted its clout to manipulate markets to the degree that it has done over most of the past year. To the extent this may be true, that could be a major sign that the U.S. may be on the brink of a huge financial crisis.

 

Even if the Federal Reserve still has a lot of financial and political options available, as I think they do, the Fed's reputation has suffered major damage. As one example, the business media are now much less likely to pass along the Fed's pronouncements without critical examination, and may even explain that such proclamations are not considered credible any longer.

 

The economic environment really scares me right now. Maybe there won't be a major crisis in the next few weeks or months. But I just don't see that the problems will be cured or go away.

 

I recommend owning a substantial position in physical gold or silver bullion-priced items in your immediate possession. I used to suggest that 10 percent of one's net worth be held in precious metals as insurance against financial calamities affecting the value of currencies and paper assets like stocks and bonds. Now, I think 20 percent and maybe even more would be a prudent allocation.

[Oldtrader3]

What more can the central bank do when mortgage rates are 4-3/4% over prime interest rates (instead of the historical 2% over prime) and the lenders are not lending any money for mortgages? This is a rhetorical question. I guess sitting on their assets and writing off foreclosures must be somehow better than trying to make new mortgages money to offset the bad old ones. Write-offs may avoid paying taxes but they don't generate revenue, especially when they are not loaning to generate new revenues which replace the foreclosures. B of A (+ Countrywide Mortgage) and Wachovia Bank have sufficient assets to write off foreclosures and generate new loans with better lending to asset ratio practices.

 

Money is frozen. The overnight lending rates are so low that they don't even pay the Bank's overhead costs to lend the money.

[World Colonial]

The problem for the banks is not that overnight lending rates are "too low" because if it were, then why was this not a problem when the Fed Funds rate hit 1% back in 2004? I am also posing this more as a rhetorical question because no one knows what is too "low" or too "high" even though central banks like the Fed pretend that they do. To the extent that the Fed has distorted interest rates (which they have almost exclusively done by trying to lower them), then the solution to the problem is not lower rates but higher ones.

 

We hear in the media that banks have lost "trust" in each other and in a sense that is true but this type of comment also seems to imply that if banks just trusted each other like they did before, that everything would return to "normal".

 

My position on that is that it is balderdash that lending and banking practices should return to "normal" because "normal" to conventional thinkers means making too many dubious loans to borrowers who had no business borrowing ANY money in the first place. And this also applies to any bank lending to another bank that uses this money to make loans to their own marginal borrowers which is what a substantial number of bank customers represent..

 

Lending standards were absurdly low. Most people recognize that now though they probably associate this primarily with mortgages. Well, they still are and would have to get much stricter before they reached any "prudent" level by traditional standards in the United States and in many other countries.

 

In the US consumer dominated economy at least, too many Americans are great at borrowing money they cannot pay back and spending money they do not have which is why balance sheets look more like a stable rag than an accounting ledger.

 

Things might return to "normal" in the US but if they do, long term prosperity for the majority of Americans will not be sustainable unitl they repair their balance sheets by increasing their savings and reducing their consumption substantially. With a ZERO or NEGATIVE national personal savings rate and with millions of Americans with essentially no savings and no wealth outside of their shrinking home equity, we are a long way from that point.

[MikeInFL]

I wonder if Mr. Heller isn't employed in the precious metals industry. I'm just saying.....Mike

[DC Dawg]

I wonder if Mr. Heller isn't employed in the precious metals industry. I'm just saying.....Mike

Ok... you had me curious... I started checking around and found that Patrick A. Heller is the general manager of Liberty Coin Service in Lansing, Michigan.

 

Over the last few weeks, I have been working from home and have had the television tuned to CNBC. What Mr. Heller has said has been said by many economists the CNBC hosts have interviewed. It is really nothing new or nothing earth shattering. If you want something shocking, the chief economist for (I think) UBS (or was it Barklays) said that Europe wants the US markets to crash--they think the crashing market will all but guarantee a victory for Barack Obama and they think that it would shake out the cruft from the markets and allow for a turnaround. They don't like McCain and they think the market is overloaded with junk that needs to be forcefully removed.

 

NOTE: This is not saying I agree with this. I am just reporting what I heard!

 

Scott

[physics-fan3.14]

Scott, this is nothing surprising at all. The Dems will definitely profit from a major economic downturn, because they will be quick to promise more government handouts (financed, of course, by me, the taxpayer). Just add on the Socialist programs, redistribute my wealth to those undeserving of it, and watch what happens to my country! You will awake to reality, and it will not be pleasant!!!! And for all you who say that people are in trouble and that I should be willing to help - its my money, I earned it, and I'll do what I please with it. I don't need the government telling me I should give it to some deadbeat in the ghetto's that collects welfare and refuses to get a job but always seems to drive a cadillac SUV and wears enough gold chains to sink an armada. Or to joe schmoe who took out a loan and now can't make the payments (yeah, the loan maker might have aggressively sold him something above his means, but responsible adults should say no, and if they aren't responsible, they shouldn't get the loan in the first place.) Now, I don't mean to come off sounding like a hard , but people need to take responsibility for their mistakes and stop thinking that the government, aka me, will come to their rescue. Yeah, they're going to loose money. Yeah, their going to have problems. But its not my fault, or my problem. I feel sorry for them, I really do, and I give plenty to charity, but own up, man up, step up.

 

 

 

 

 

Sorry, got a little carried away. But its true.

[thehumantorch]

 

Lending standards were absurdly low. Most people recognize that now though they probably associate this primarily with mortgages. Well, they still are and would have to get much stricter before they reached any "prudent" level by traditional standards in the United States and in many other countries.

 

In the US consumer dominated economy at least, too many Americans are great at borrowing money they cannot pay back and spending money they do not have which is why balance sheets look more like a stable rag than an accounting ledger.

 

 

What lending standards? When I bought a house 16 years ago I only had 15% to put down on 148,000 mortgage. I was required to pay extra $3500 for Canada Mortgage and Housing Corporation to back my low down payment.

 

The mortgage situation was one of pure greed. Agents were paid a commission to sign up a mortgagor. Often proper standards were ignored, no money down, payments that didn't pay the interest, zero scrutiny of a borrowers ability to pay back the mortgage, giving the borrower additional cash beyond the mortgage amount. The mortgages were packaged up and sold to investors as high quality investments. I would imagine for a fee.

[World Colonial]

I agree with your sentiments completely and your example is what I am talking about. There have been no lending standards in the recent past and based upon what I would describe as prudent and responsible banking and lending, there still are little or none itoday, at least n the United States.

 

Its almost a joke to listen and read media talking heads refer to the "credit crunch". Its true that there is one relative to what existed even a year or two ago but credit is still available on very favorable terms to all but the least creditworthy borrowers.

 

The problem today is that most borrowers are not really credit worthy based upon their personal balance sheets and their ability to pay under any adverse circumstances, though no one would ever know this from conventional modern practices such as the FICO and other credit scores.

 

I have made many references to personal balance sheets in my posts on this topic because today, the balance sheet is ignored just as it it with evaluating stocks. (That is, except like now with banks since many are about to go broke). I was not around or at least not in the market for credit at the time, but I know that lending standards used to be much stricter and borrowers (shocking and dimaying as it may be) actually had to demonstrate a real capacity to pay at one time and the long enough ago the loan would also require security. There was no absurd Bizarro World lending practices where these deadbeats could get unsecured credit lines up to or even greater than their annual income or use their home as a personal ATM.

 

Were now hearing that the credit problems are spreading to "prime" mortgages and possibly other loans. Well, my response to that is that if these loans were really prime, most of these people would not be financially stressed and at risk of default or foreclosure at the first hint of economic duress. Sure, there are always individual circumstances but the economy has not even (officially at least) experinced a SINGLE quarter of negative economic growth.

 

The truth of the matter is that any borrower, no matter how high the FICO score, who does not have a financial cushion to cover their expenses if they lose their job for even a few months is not a prime borrower. They are basically broke but just do not know it.

 

As for your last paragraph, that is a function of the moral hazard which exists in the financial system because either no is accountable to anyone (except in theory) or no one cares. But that is a subject for another day.

[mrearlygold]

You can't have an immoral and failed system such as socialism and at the same time have a healthy middle class. You can have those who have and those who don't. That's a socialist system.

 

That's present day America no matter which "party" is governing. One thing is certain, no matter who wins the white house, we will have a larger government and more social programs by the time the next "election" rolls around. And if anyone thinks there's free elections in the US well......

 

Bye bye middle class. That giant sucking sound has been going on for years and years now. Economically speaking, unless we have a real change, a real shakup in the system such as a Ron Paul in the White House, there is no way we will see a return to a more free country. It's not economically possible while supporting the worlds most intrusive military and all the socialist programs.

 

You can't have that and freedom too. Judging by the lack of outrage ( lack of awareness and intelligence too ) over this election and where we are in terms of our freedoms, looks like the American people have opted instead for more socialism.

 

 

[World Colonial]

Physics,

 

You have nothing to apologize for because the other side which pretends to care really does not give a rat's about the poor or the disadvantaged. Many of them are just two faced hypocrites.

 

Have you ever noticed how often someone else's "compassion" ends being paid for at someone else's expense? If these people really had compassion, they would actually DO something themselves which required SOME level (ANY level) of PERSONAL sacrifice. Instead, they use the political process through the ballot box to politically compel others to pay the cost for the "good" they are "doing". That is how we can know that the real agenda is socialism.

[Oldtrader3]

Article from New York Times, Business Section. The sky is not falling Chicken Little!

 

Analysts Say More Banks Will Fail

 

Article Tools Sponsored By

By LOUISE STORY

Published: July 14, 2008

 

As home prices continue to decline and loan defaults mount, federal regulators are bracing for dozens of American banks to fail over the next year.

Skip to next paragraph

Related

Times Topics: Banks and Banking

 

* Fannie Mae

* Freddie Mac

But after a large mortgage lender in California collapsed late Friday, Wall Street analysts began posing two crucial questions: Just how many banks might falter? And, more urgently, which one could be next?

 

The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.

 

But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers.

 

“Everybody is drawing up lists, trying to figure out who the next bank is, No. 1, and No. 2, how many of them are there,” said Richard X. Bove, the banking analyst with Ladenburg Thalmann, who released a list of troubled banks over the weekend. “And No. 3, from the standpoint of Washington, how badly is it going to affect the economy?”

 

Many investors are on edge after federal regulators seized the California lender, IndyMac Bank, one of the nation’s largest savings and loans, last week. With $32 billion in assets, IndyMac, a spinoff of the Countrywide Financial Corporation, was the biggest American lender to fail in more than two decades.

 

Now, as the Bush administration grapples with the crisis at the nation’s two largest mortgage finance companies, Fannie Mae and Freddie Mac, a rush of earnings reports in the coming days and weeks from some of the nation’s largest financial companies are likely to provide more gloomy reminders about the sorry state of the industry.

 

The future of Fannie Mae and Freddie Mac is vital to the banks, savings and loans and credit unions, which own $1.3 trillion of securities issued or guaranteed by the two mortgage companies. If the mortgage giants ever defaulted on those obligations, banks might be forced to raise billions of dollars in additional capital.

 

The large institutions set to report results this week, including Citigroup and Merrill Lynch, are in no danger of failing, but some are expected to report more multibillion-dollar write-offs.

 

But time may be running out for some small and midsize lenders. They vary in size and location, but their common woe is the collapsed real estate market and souring mortgage loans. Most of these banks are far smaller than the industry giants that have drawn so much scrutiny from regulators and investors.

 

Still, only six lenders have failed so far this year, including IndyMac. In 1994, the Federal Deposit Insurance Corporation listed 575 banks that it considered to be troubled. As of this spring, the agency was worried about just 90 banks. That number may go up in August, when the government releases an updated list.

 

“Failed banks are a lagging indicator, not a leading indicator,” said William Isaac, who was chairman of the F.D.I.C. in the early 1980s and is now the chairman of the Secura Group, a finance consulting firm in Virginia. “So you will see more troubled, more failed banks this year.”

 

And yet IndyMac, one of the nation’s largest mortgage lenders, was not on the government’s troubled bank list this spring — an indication that other troubled banks may be below the radar.

 

The F.D.I.C. has $53 billion set aside to reimburse consumers for deposits lost at failed banks. IndyMac will eat up $4 billion to $8 billion of that fund, the agency estimates, and that could force it to raise more money from the banks that it insures.

 

The agency does not disclose which banks it thinks are troubled. But analysts are circulating their own lists, and short sellers — investors who bet against stocks — are piling on. In recent weeks, the share prices of some regional banks, like the BankUnited Financial Corporation, in Florida, and the Downey Financial Corporation, in California, have stumbled hard amid concern about their financial health. A BankUnited spokeswoman said the lender had largely avoided risky subprime loans.

 

In his “Who Is Next?” report over the weekend, Mr. Bove listed the fraction of loans at banks that are nonperforming, meaning, for example, that the assets have been foreclosed on or that payments are 90 days past due. He came up with what he called a danger zone, which was a percentage above 5 percent. Seven banks fell in this category.

 

An important issue for the regional and community banks will be whether they have managed to sell their riskiest loans to Wall Street firms.

 

And the government may have fewer failures than in the past because private investment funds might buy some troubled lenders. Regulators are considering rule changes that would allow private equity firms to buy larger shares of banks, and several prominent investors, like Wilbur Ross, have raised funds to leap in.

 

Eric Dash contributed reporting.

[World Colonial]

These articles are yet another example of the false assurances spread by government officials in the last 18 months. And if anyone does not believe me, then go back and read them for themselves.

 

First they claimed subprime would not be a problem. Then when it obviously was, they said it would not impact the broader housing market. When housing sales fell off a cliff, then then said that housing prices would not fall. When this proved false, they said it would not spread to the broader economy. Now that it obviously has, most are either saying that their will be no recession (an absurd notion in my opinion) or that the recession will be shallow and or short.

 

My advice is to ignore these assurances and lose your confidence now to beat the last minute rush. Investors have collectively lost a fortune listening to this type of message and are likely to lose substantially more before this collective fiasc is over.

[just-john]

My resent look a GOV jobs . com shows 25 openings for accountants in AZ for thr FDIC

banks are the next thing in line if people arn't paying their house payments the sure arn't paying their visa master card and car payments

[World Colonial]

This anecdotal (but still significant) example you cite is why I am as bearish as I am on both the economy and the stock market.

 

No matter how wrong conventional thinkers have and will continue to be, most people still do not "get it". The mania which just ended in housing is a sympton of the broader credit bubble which is over. If this is correct, that is why this will not be a run of the mill recession but a deep and/or protracted economic contraction.

 

The financial sector is in the process of imploding and is grossly capital impaired. Without adequate capital, lending will contract and so will the economy no matter how many absurd and bogus adjustments the clueless regulatory and rating agencies make. The market decides what is adequate and right now it has made its decision that many banks are almost flat broke.

[michael]

we are currently in a recession which will get worse before it gets better and not get better till the end of 2009

 

also the usa dollar is undervalued and will be much higher against the euro by the end of 2009

[EZ_E]

we are currently in a recession which will get worse before it gets better and not get better till the end of 2009

 

also the usa dollar is undervalued and will be much higher against the euro by the end of 2009

 

Shoot, Mike, it's just getting started! There are 77 million baby boomers who are now eligible for early social security benefits. This can be the proverbial straw.

 

http://www.jonchristianryter.com/News_Folder/Behind.html

[Oldtrader3]

I have paid in way in excess of $60K (their numbers) into Social Security over the past (45) years and if the lying, thieving, hypocrites in Congress of this great country of ours had not pillaged the surplus every year since 1964, there would not be a crisis in Social Security ever! Got that, clearly in your heads (youngsters who do not believe in Social Security)! They stole our money and now they claim it is our fault! That is B*** S****!

 

I did a quick calculation one day when I was bored at work and figured that if I had been investing that Social Security payment twice a month at an average interest rate of 6% (not unreasonable considering the time's interest rates), I would have over $500,000.00 in the bank, because I paid over the maximum each, stinking year for 45 years.

 

The blasted, two-faced, thieves in Congress are the problem, not me! If the stinking Congressmen in Washington cut out my and several million of my generation's Social Security, me and several million others are going to fix bayonets and march on Congress! There will be a public uprising like you will not believe! We are not fooled by Congress' stupid smoke screen, they are s*c*r*e*w*i*n*g 70 million of us if they cut our benefits, plus they are hosing all of you as well!

 

They spent our retirement surplus payments on their stupid pork programs for their bridges and roads to nowhere and Ted Stevens pillaging of Alaska! Did you know that the logging industry subsidy for uneconomic logging in Alaska could pay every logger in Alaska over $100,000.00 per year to sit at home, do nothing and still save money on the federal subsidy costs!

 

Ask me now, how I really feel!

[chinook]

we are currently in a recession which will get worse before it gets better and not get better till the end of 2009

 

also the usa dollar is undervalued and will be much higher against the euro by the end of 2009

 

Shoot, Mike, it's just getting started! There are 77 million baby boomers who are now eligible for early social security benefits. This can be the proverbial straw.

 

http://www.jonchristianryter.com/News_Folder/Behind.html

 

It is highly unlikely that very many will "retire" as they will never be able to support themselves.

[michael]

oldtrader3 you are correct

 

but well you cant change things as this is the way it is

 

and in this society the govt penalizes savers

 

and as chinook says

 

you got to think proactive and plan on a working retirement or doing something to supplement retirement and most likely paying more taxes as the poor will never pay it nor the rich so who is left to pay it?

 

the working class as always

 

and we got iraq and afganastigan to still pay for

 

 

[Oldtrader3]

Michael, MHO is that all of our children and grandchildren need to know that the Congress of this country stole their retirement savings surplus and heritage to spend on their wasteful pork programs. Someday there should be a reckoning for these greedy so-called leaders with one hand on their bible and one hand in our pockets.

[CHABSENTIA]

Michael, MHO is that all of our children and grandchildren need to know that the Congress of this country stole their retirement savings surplus and heritage to spend on their wasteful pork programs. Someday there should be a reckoning for these greedy so-called leaders with one hand on their bible and one hand in our pockets.

 

And how did they get there? In the last 30 years or so 90% 0f the Incumbents have been returned to Congress.If you had a Business and your employees had no regulation and they were given an automatic raise every year and retained no matter their performance then we know what would happen.The big diference is that if they used your Money until it was all gone then you would be out of Business. They can just raise taxes etc.

[Oldtrader3]

The members of Congress do not care about us. What needs to happen is to make them pay Social Security and Medicare taxes and retire with the same social insurance benefits that we receive, plus a supplemental pension for congressional service. Then the thieving hypocrites in Congress would fix Medicare and Social Security so fast it would make your head spin! They also should be made to be 65 years old to receive a full benefit, just like we minions do.

 

As it is, they are fully vested with their full pension and medical retirement benefits after only six years, whereas it takes we minions at least 30 years of work and payments to be fully vested, depending on how much you have paid in. Plus, you have to be 65 years old to receive full benefits. Additionally, most company's pension plans have a hockey stick effect where at least another 30% of your pension accrues in the last 10 years of working, so, retiring at 55, you only get 70% of your 65 year old vested pension.

 

Congressmen and Senators do not have to be 65 years old to receive their benefits. They get no reduction of benefits for early retirement. They should be treated no differently than the rest of the working world, including executives. That would solve the problem and would make them care greatly about whether we "have no bread, so let them eat cake" or not.

 

If you work for a private company, you also lose 4% (by federal law) of your corporate retirement benefits for each year of early retirement under age 65, plus you must be 55 to receive any benefits at all. In other words, if you retire from a company's pension plan at 55, your company pension benefit is reduced by 40%. Not only that, but your actual accrual of pension benefits are only about 70% accrued because of the hockey stick effect of private pension plan vesting. So, if you retire at 55 years old you actually only get 70% of the 60% pension reduced accrual. What you would get at 55 years old is actually only 42% of your corporate pension, rather than 100% at age 65.

 

Plus, your Social Security pension is also reduced at least 30% if you retire at age 62 and were born after 1950. Your spouses benefit is also reduced by 35% at age 62. So try to retire early and live on 42% of your company's retirement vesting and 70% of your Social Security benefits. I know the math is correct because I've administered these plans, as a Plant Manager!

[michael]

it is truly sad as the chickens are coming home to roost

 

and even sadder

 

the golden rule is that

 

those in power and rich have the gold and make the rules

[Houston Investor]

Oldtrader 3 - I agree with your comments. It is a shame how workers are shafted by the corporations and government.

 

In the meantime, gold coins purchased close to melt are a good investment. At a recent stop at a local coin shop I saw a customer offering 2 Presidential Spouse NGC MS 69 Abigail Adams $10 gold coins. He was offered 97% of melt as the dealer said the refiner (this material is melted and made into bars) pays 98% as there is little demand for these coins and instead they are melted into gold bars. Funny thing I saw a PCGS graded MS 69 in his show case. I did not inquire about it but have bought slabbed modern gold at this shop before close to melt. A few months back I saw them buy some MS 70 AGE's at melt + 5$ for the lot (about 2.5 oz). So much for 70's carrying a premium! Next time I am in a major buy mode, I plan to call him and ask him to notify me when he buys any of these at or below melt as I would like to buy them at a tad more than what the refiner pays.

 

Makes me wonder if the dealer was leading the seller down the garden path or there really is an economic reason to melt these modern commem pieces. I know the CDN does not reflect much more than melt for this issue as Bid.

 

It is certainly sad if these are really being melted.

[Oldtrader3]

The pendulum has begun to swing the other way. The bank stocks rallied and recovered a good portion of their losses in the past month with bottom of the market being tested, after a double bottom by a strong rally the last three days of the week.

 

So the naysayers can put their failure banners away for the present and we all can take a deep breath and wait until the next crisis comes along because it seems as though this one has been averted for the present and we all can breathe a sigh of relief that our system as we know it, is probably averted the ax this time. Now maybe we all can get back to work, do our part to help recovery and support our country through the difficult times ahead.

 

I think that John McCain shot himself in the foot so badly with my generation recently, regarding Social Security, that he is now regarded as toxic waste and can not win this election by any means. So, we're going to elect Barack Obama, a man who means well but is mostly clueless about foreign policy and the Federal Reserve and worldwide central banking system, as well as our economy and how entitlements and tax revenues as a percentage of GNP regulates and affects our lives and the other economies of the world. God help us in the next swing of the pendulum.

[jtryka]

I hope Obama wins, this country needs a reminder of the Carter years! As for socialist security, my generation expects a big fat check for exactly $0 from it and that 7.65% is just another income tax to us, nothing more.

[Oldtrader3]

I realize that my children's and the generations behind us, believe that the Social Security payment of 7.65% of your earnings is just another form of taxation. However, it is in fact a promise made to us by our country as a safety net to assure that the elderly do not end up (again) as they did in the depression with nowhere to live or nothing to eat. Your generation does not want to share what few good jobs there are left with we old fogies who have the education, experience and will work for less.

 

Besides a person earning $100,000 now pays 60% more Social Security tax on that same salary level than I did in 1994. You should expect something from those taxes instead of just being fleeced by our disingenuous politicians to pay for their pork and excess spending. We in this country have fought (5) wars since I was born to protect our way of life and have paid taxes, Social Security and Medicare taxes the entire time to assure some safety net for all. We have the right to expect something in return except being shafted by our politicians. Plus, I still pay $125.00 per month and my wife pays $90.00 per month additional in Medicare premiums out of our Social Security checks. Plus our private insurance premiums through COBRA.

 

Notice how all politicians, except Bush who does not really care, backed down on cutting benefits by 10% on Medicare benefits. The Physicians and big pharmaceutical companies give big bucks to those coward's, whom we elected to Washington, toward their re-election campaigns. None of them have the guts to cut Social Security because they would be unemployed and would lose the AMA and Pharmaceutical money nipple that they have been sucking on. They just can't stop stealing the surplus from Social Security each year. Bad habits die hard, like bad politicians.

[EZ_E]

I hope Obama wins, this country needs a reminder of the Carter years! As for socialist security, my generation expects a big fat check for exactly $0 from it and that 7.65% is just another income tax to us, nothing more.

 

That's very true. I've paid over $40,000 into the SS system and I'm just 42. I don't expect to get a dime of it back unless I somehow get disabled. It's a tax with no dividends to my generation. As it stands now, I'd have to be 67 to receive full benefits. Like, right, the money is going to be there in 25 years.

 

So Charlie, even though you are 100% correct in your statements (which I loved reading, btw), you still have it damn good compared to us. I don't trust the stock market, either, or 401K's. That leaves coins and properties for me to try to finance my retirement, maybe even outside of America on some tropical island.

[CHABSENTIA]

I realize that my children's and the generations behind us, believe that the Social Security payment of 7.65% of your earnings is just another form of taxation. However, it is in fact a promise made to us by our country as a safety net to assure that the elderly do not end up (again) as they did in the depression with nowhere to live or nothing to eat. Your generation does not want to share what few good jobs there are left with we old fogies who have the education, experience and will work for less.

 

Besides a person earning $100,000 now pays 60% more Social Security tax on that same salary level than I did in 1994. You should expect something from those taxes instead of just being fleeced by our disingenuous politicians to pay for their pork and excess spending. We in this country have fought (5) wars since I was born to protect our way of life and have paid taxes, Social Security and Medicare taxes the entire time to assure some safety net for all. We have the right to expect something in return except being shafted by our politicians. Plus, I still pay $125.00 per month and my wife pays $90.00 per month additional in Medicare premiums out of our Social Security checks. Plus our private insurance premiums through COBRA.

 

You are missing something here.There is a Tax on Social Security Benefits that were put into place by Clinton and his Congress.It is based on $25,000.00 for Single people on Social Security and $32,000 for Married people. I check the Formula every year. Here is how it works for married people.

1. Add your total Social Security Benefits.

2. Divide by 2

3.Add all other Income to this figure.

 

So if the total Social Security payments to a married couple was $20,000 which would make it $10,000 and you had more then $22,000 in other Pensions or Dividends from Stock(Municipal Bonds are exempt) or other Income then you would pay a graduated tax on your Social Security Income.Remember the cry in the Clinton yeras about people being Rich if they made more than $32,000?

 

Of course the Dollar is worth less today and costs are also more but the tax remains in place. So after you pay the Medicare premiums and if you were "foolish" enough to provide for more Security and provide too much then you risk an increases tax as the Limit is still in place.

 

Anybody that gets to the age of 65 and does not have their Home and Car paid for and does not need excessive Drug prescriptions is in trouble. If a Person has to go into a nursing home then Medicare pays for the first ten days . After then they do not generally pay which means that the patient has to pay providing they have the means.If you have a Home then it could be up for grabs. I don't think that measure exists here in Florida because of the Homestead Act.Other States do not have it.The law is such that you can't just liquidate your Estate and give the Money to somebody else as it has to be done a certain number of Months before the News or it is seen as trying to protect it from seizure.

 

 

Young people today do not have the slightest idea what awaits them when they get old if they do not make provisions and that is if things don't get worse. It is doubtful that they will get any better.In the last two years my Property Insurance has gone up 50% here in Florida and I am not in the Hurricane area. There are only two Major Home Insurers here In Florida and they have not been taking any new Policies and some are not being renewed if they live in an area which has been hit or they have too many Claims. People that are buying Homes either have to go with the few small Insurers or the Florida Risk. If I were a new resident or have to be Insured under the Florida risk then I would be paying five times what I pay now and that is after going up about 100% in the last two years.

 

Things are only going to get worse. We imported 225 of our Oil in the 1970s and it was 45% in the 1990s and is about 70% today. Oils not used for just Gasoline but is needed for the Manufacture of Plastics and Rubber and Synthetic Fibers so anything that contains Rubber is going to be more expensive. Anyhting that is made of Plastics such as wrapping or containers for Food means Food is going to be expensive on that alone and anything that contains Synthetic Fibers such as Clothes is going to be more Expensive. For at least the last thirty years people have been returning 90% of the Incumbents to both Houses of Congress. It is only the other 10% that sometimes makes up a slim Majority.It should be obvious where the problem lies because there hasn't been the same President/s for thirty years.

 

Don't expect anything to get better. I am still looking for $5.00 a gallon gasoline unless there are some drastic changes.

 

Notice how all politicians, except Bush who does not really care, backed down on cutting benefits by 10% on Medicare benefits. The Physicians and big pharmaceutical companies give big bucks to those coward's, whom we elected to Washington, toward their re-election campaigns. None of them have the guts to cut Social Security because they would be unemployed and would lose the AMA and Pharmaceutical money nipple that they have been sucking on. They just can't stop stealing the surplus from Social Security each year. Bad habits die hard, like bad politicians.

[BankNote1]

Well, I don't have much extra money to buy gold with groceries, gasoline, electricity, and everything else, going through the roof!