posted on Mar, 8 2005 @ 03:31 AM
Rant I too remeber the 98-01 bubble. I was working as a retail broker at the time. The problem is that you, like most of america, were (and I truly
mean this without attempting to offend) ignorant of the true nature of the markets. Fine you learned a valuable lesson, even in the stock market,
there is no such thng as money for nothing. However Thats is also not to say that the market is as risky as going down to the local track and putting
your retirement on the #4 horse either.
My point is a lot of americans lost a lot of money in when the buble burst, and most deserved it, probably including you. I dont say this to be
offensive or cruel, but there is a reason why ttradng is one of the highest stress professions in the world. There is a reason that the market created
mutual funds, hedge funds, UIT's etc.
Under the personal retirement accounts plan, If I am not mistaken you would have the abillity to invest in such securities but not indivdual
Why is this important? Simple indivdual stocks are at the greatest risk of both iraational infalton as well as crashes. Mutual funds etc. while not
risk free are far less risky.
Now the best rate of return I can find for social security is 1.23% per annum.
Keep in mind that that rate is substansially lower than even government treasury bonds.
Also keep in mind that according to a study done by the london school of business, over the last 50 years every major stockmarket has outperformed
bond rates by a substansial margin.
Now assuming you plan starts with 1000 USD and you contribute only an additional 600 USD per year (50 per month over 20 years the difference is
Current ss system 14,954
basic index fund stock index at only 3% per year 18,412
Thats a differnce of 23% at only three percent. Now when you compare it to the historical average of ndex funds whch do nothing more than track the
broader market based on thier average rate of return over the last 35 years the differences are even starker
S&P 500 (dflcx) 35 yr average -11.12%
US large value (dflvx) 35 yr average - 14.14%
US microcap (dfscx) 35 yr average -12>81%
Now lets see what the diffence is
current ss system - 14,954
S&P - 51,637
Over three times as much.
The point I am making is that for the average indivdual investor like yourself rant, as long as you dont get greedy and attempt to "beat the
markets" even if you simply stick your persoanl retirement account into the DJIA, NASDAQ SPYders, or the S&P 500, and most importantly as long as you
take a long term outlook (remember these are average figure, which means some years better, some years worse) And stick to a long term plan, you will
make more. You will have more to retire on, and you will be better off.
Now on to healthcare. Rant the simple fact is, that anything the government touches becmes more expensive, wanna know the real reason why healthcare
has shot up in price over the last 30 or so years?
1) Malpractice insurance, ask your local GP how much he pays in insurance alone, it'll surprise you.
2) Back in the seventies, (you may remeber this rant) Doctors used to, if you needed X-rays, bloodwork etc, send you to a clinic which they owned all
or part of. It was a way of increasing thier offices revenue's and due to the competition between doctors the prices were reasonable. Enter the
federal governemnt who passed a law outlawing the practce, all of a sudden doctors lose about 40-60% of thier revenues. (yes it really was that big of
a percentage) at the same time, the government gets involved in insurance, so the doctors are making less overall and now because of the bargaining
power of the insurance industry, they are also making less per procedure. The result is "insurance consultants" who doctors employ for the sole
purpose of showing them how to bill the insurance company for more (also the reason you or your insurance gets charged for gauze, syringes etc, which
no doctors did in the 70's) So what does the insurance company do? Raise premiums, again and again and again.
Now considering that the federal government started this chain of expense, how do you expect them to fix it.
Rant agree that AA was effective. n the sxties it was necessary, but as the former hiipy turned stockbroker said to hs old sit in buddies,"this aint
the sixties no more man"
The fact is that equality, based on percentages has been reached. AA was never meant to be a permanent solution, it was meant to kick start things,
and it did. FOr christ sakjes we have a female, black , secretary of state and a hispanic AG. Now you can say that it was done for political reasons,
and I am sure there was a political dimension to it, but the fact is America itself has changed. Being black is no longer a stigma, nor is being
mexican (unless illegal for which there is good reason) cuban, haitan etc. How many black mayors, senators etc are there?
AA was necessary for a time that time has passed. There is no reason any minority can not through hard work succeed, not anymore. The KKK is a joke,
the Neo Nazi's are irelevant, the Black Panthers are no longer necessary, and though racism still exists on all sides, it is no longer a major factor
in American life. In fact keeping AA around now can nly make things worse, there is no longer a division between "races" in the minds of the average
americans, why put one there by government mandate?