Gingrich's Social Security plan is insane. (user search)
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  Gingrich's Social Security plan is insane. (search mode)
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Author Topic: Gingrich's Social Security plan is insane.  (Read 2009 times)
Badger
badger
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« on: November 23, 2011, 09:16:29 AM »

Wonkish, it's truly unbelievable that you or anyone would seriously argue a privitization plan can work based on "little volitility" in the market. Have you been in a cocoon for the last 3 years?
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Badger
badger
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« Reply #1 on: November 23, 2011, 09:44:04 AM »

Wonkish, it's truly unbelievable that you or anyone would seriously argue a privitization plan can work based on "little volitility" in the market. Have you been in a cocoon for the last 3 years?

Frustrated sigh! Are you trying to not read my post very well?

Is there only stocks in the market?

Or are there corporate bonds, muni's, CD's, Money market accounts, etc.?

What I was saying is okay you get intimidated by money being 100% equity options? Fine make all of the options at least fairly conservative. It still is a better deal social security. Hell you could say that the only choice was money market accounts and based on historical averages you would crush the average performance of Social Security today(its that bad). And when you're looking at investment grade bonds, CD's, and money market accounts then yes you are looking at less volatility then you see in 100% stock funds and indexes.

Didn't you notice I used a 4-5% assumption instead of an 8-9% assumption that is traditionally used for 100% equity investment? That's because I was assuming significantly more conservative choices.

Now do you get what I was saying?

I read your post quite well. The other investment options you mention either carry their own lesser degrees of volitility and diminishing returns. Corporate bonds? Why that seems perfectly safe, and recent history has shown no proof no the contrary.

Gingrich's plan, like any Social Security privitization plan, is quite transparently a path to placing all Wall Street on the corporate welfare teat courtesy of retirees nest egg, and eventually get rid of it as a dirty, dirty public function.
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Badger
badger
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« Reply #2 on: November 23, 2011, 10:25:29 AM »

The losses are coming in large part due to the baby boom retirement. That will eventually subside as they die off later this century. When talking about a societal-wide retirement plan, it's ok to think in the time frame of generations rather than mere decades. It may not be the worst thing to assume there will be a generation of solvancy issues--perhaps much further in the future than you state, depnding on which study one reviews--before the worker to retiree ratio restabilizes. Right now, the baby boom iis an anomoly; the graph equivilent of python that recently ate a pig.

At any rate, why on earth would one trust such restraint from politicians like Gingrich who--minimum required lip service to remain politically viable aside--has made it very clear at a personal and (psuedo) intellectual level to the core of his being he opposes government activity outside "traditional" (i.e. Victorian) roles,and believes the private sector is fundamentally best when left completely and utterly to its own devices. The man abhores even unremittingly successful social policy like Social Secuity on a visceral and unbending philisophical level. The fact he himself is vastly wealthy (not Rmoney wealthy, but..) and never will need a dime of social security, nor will anyone in his family or any friend in his life.

In short, there is ample and good reason for distrust. The issue here isn't benefiting retirees--never has been--but really just an unremitting war against any successful actions by government that interfere with ivory tower delusions of recreating a mythical version of The Gilded Age.

I'm not a Gingrich fan as you can suspect. Tongue
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Badger
badger
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« Reply #3 on: November 25, 2011, 03:40:35 PM »

OK, you are the expert. I get it Wonkish1. I give up.

You might however want to recheck the implicit social security return thing.

By the way, did you ever hear of "Dunn's Law?"  Smiley

That author wouldn't be you, would it Torie? Or simply a coincidental namesake?
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Badger
badger
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Posts: 40,317
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« Reply #4 on: November 25, 2011, 10:16:47 PM »

Impressive! Smiley

But you really should listen to Wonkish more closely. Trust me. He's in finance; he really knows what he's talking about!
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