From another angle see US politics .

Bush's social security reform (1/28)
A plan to benefit financial group

What Bush intends to do is to force young people to invest their retire pension into financial market. Who will be winner and who will be loser?

Financial market, especially the stock market, is a speculating market. How can Bush expect people will win in that market? He has no assurance. But one thing he knew for sure is that the financial group will benefit a lot from his proposal.

When people went to Las Vegas. The winner is always Casino. Aladdin, Mirage.... all these grand Hotel were built up on the money lost by gamblers. But at least those gamblers are willing to go there and they more or less got some entertainment.

For those who put their money in financial market, they can expect to contribute more to Gold Sach, JP Morgan, Citi Bank ....

That's probably why Bush only proposes the reform at young people and to a limit portion. If his proposal is real good as he said, then why didn't he suggest to privatize all social security fund, and apply it to all ages? He dares not. He knew there is a risk. Once such a fainancial disaster takes place, the impact won't be felt by young immediately because there is still sometime to their retirement age. They became a Guinea pig of Bush's plan.

The main work Bush did in his first term was to contribute a high profit for military industry and oil group. It seems the mission for him in 2nd term is for the profit of financial group. That is why he is awarded with four more years

Bush's social security reform (1/28)
A plan to benefit financial group

What Bush intends to do is to force young people to invest their retire pension into financial market. Who will be winner and who will be loser?

Financial market, especially the stock market, is a speculating market. How can Bush expect people will win in that market? He has no assurance. But one thing he knew for sure is that the financial group will benefit a lot from his proposal.

When people went to Las Vegas. The winner is always Casino. Aladdin, Mirage.... all these grand Hotel were built up on the money lost by gamblers. But at least those gamblers are willing to go there and they more or less got some entertainment.

For those who put their money in financial market, they can expect to contribute more to Gold Sach, JP Morgan, Citi Bank ....

That's probably why Bush only proposes the reform at young people and to a limit portion. If his proposal is real good as he said, then why didn't he suggest to privatize all social security fund, and apply it to all ages? He dares not. He knew there is a risk. Once such a fainancial disaster takes place, the impact won't be felt by young immediately because there is still sometime to their retirement age. They became a Guinea pig of Bush's plan.

The main work Bush did in his first term was to contribute a high profit for military industry and oil group. It seems the mission for him in 2nd term is for the profit of financial group. That is why he is awarded with four more years

Social security fund (2/8)

Bush uses the same tactic to carry out his policy: intimidation. In his first term, to start a war, he scared Americans that the "WMD" in Iraq posed imminent threat to US. Now, he repeated that social security is headed toward bankrupcy. He proposed that young people to privatize one third of their s.s. fund (4% of income) into financial market.

Does he really care for the benefit of young generation? No. He hurt them. In his first term, he had a tax-cut plan which mainly benefit the rich people. At the same time, he created a historical deficit. In another word, he borrowed the money to pay tax-cut. That loan he borrowed, after all, must be paid back. The payer will be the young generation. Bush put a debt burden on them. That's not enough, he is seeking to steal their retirement fund.

Is social security fund in danger now? Not really. The Social Security Administration estimates the fund will last until 2042; many economists estimate the fund will last much longer. There are many other ways to balance the s.s. fund account then. Here is a chart compare the shortage of s.s. funds compare to tax-cut over 75 years.

...........................Shortfall or cost as a percent of GDP...In trillions of dollars
...........................over 75 years ...................................over 75 year

Shortfall, Social Security Trust Fund ...... 0.4% ............. NA
(CBO est.)

Shortfall, Social Security Trust Fund ......0.7% .............. $3.7 trillion
(Trustees estimate)

Cost of the 2001/2003 tax cuts, . ......... 2.0% ............ $11.6 trillion
if made permanent

Tax cuts for top 1 percent, ..................... 0.6% ............... $3.4 trillion
if made permanent

www.cbpp.org...

There was lesson from privatization. 401(k) was allowed to enter financial market in 1994. When the dot.com bubble broke out in 2001, many people suffered great loss in their retirement pension account and have to delay their retirement plan. Some people lost most of their pension when Enron went bankrupcy.

In Bush's plan, first of all, the young generation will lost 2 trillion. The administration fee of privatization estimated at 15% to 20% of total investment amount. Financial group win the first round even without a battle. And then, in a pool where big fish fighting with small fish and shrimp, who will be winner?

Most people left casino with full pocket? or empty pocket? Judge with your common sense.

Winner and loser

Quote, "Historically, the stock market has offered + 10% returns over the long haul (40+ years)."

Who got that 10% return? Rich people. When they got 20%, 30% or above, Much more people got 1%, 2% or negative return.

When Buffett got a return much higher than others, someone must pay for the money he made. The payer will be the average people.

RE: Gates, Buffett, China 'run from dollar' Expert sees development as sharp warning to Americans Posted: February 3, 2005

Decisions by the world's two wealthiest men to bet on a further weakening of the U.S. dollar, coupled with China's lack of confidence in American currency should grab the attention of every working person, says Craig Smith, CEO of Swiss America Trading <

Microsoft Chairman Bill Gates is following the example of Berkshire Hathaway Chairman Warren Buffett, who made a pretax gain of $412 million in the fourth quarter of 2004 by buying foreign currencies.

www.worldnetdaily.com...

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RE: MUTUAL FUNDS TO AVOID

These 10 Funds are the worst of the worst. See how much a $10K investment would be worth after five years:

· T. Rowe Price Sci & Tech: .......... $3,534 ·

Putnam Voyager B:......................... $5,971 ·

White Oak Growth Stock:.............. $5,593 ·

Janus Global Technology: .............$3,504 ·

Putnam Growth Opp.: ......................$4,359 ·

MainStay Cap. App. B:................... $5,817 ·

Scudder Growth Fund A:................ $5,638 ·

PIMCO PEA Innovation C:............. $2,667 ·

Morgan Stanley Info B: ...................$3,378 ·

Firsthand Tech. Val. Inv: .................$3,602

pf.channel.aol.com... _s=1&_u=http%3a%2f%2faolpf5%2emarketwatch%2ecom%2fnews%2fstory%2easp%3fguid%3d%257B3EF618CE%252D7C1D%252D4AB8%252DA892%252DA3B3A2A28A84%257D%26siteid% 3daolpf%26dist%3daolclick
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Government always tell you the average return of financial market. They will never tell you who got the chunk and who got the bit. Casino show you some one got the million dollars prize. They don't tell you most people go home with empty pocket.

My question is still there. If stock market is that good as you said, 10% return in long period, then why don't invest all S.S. fund into that market? Even children is able to know it.

Because only a few of people benefit a high profit. Most people are the loser. Did you see the work of above mutual fund? They are iceberg of failed investment firm. In five years they not only made no income, they also lost 50% to 70% of its fund. I can tell you the loser won't be Buffett, Gates, Lockfeller or Morgan, it's average people.


[edit on 17-2-2005 by kathaksung]

In 1930, the collapsed stock market caused Great Depression. It motivated the government to build up the Social security system. Of course, the Social Security fund avoided the trouble making - stock market. The fund is invested in national bond which gives a guaranteed income. Not very high but stable. What Bush now is leading people back to that trouble making - stock market. Is that absurd?

Social Security is a successful program. The expense is low. The administration fee is less than 1% of total investment. It is also a rare clean program. Pension are collected, paid to retired people. Interest group can't touch it with any excuse. In a clear water tank, The quantity of fish is clear, countable.

Now Bush tries to meddle the water, said you can catch more fish in muddy water. But muddy water won't produce more fish. Someone may catch more fish, But their gain will be others' loss. Making high profit in stock market is always the previledge of inside group. Average people, after all, will gain less if not a loss.

Re: This is a problem that is beginning to be recognized. Since 1964 Nebraska offered state employees the chance to manage their 401(k)-type plan. Extensive employee education and training seminars were given, and everyone expected outstanding investment returns. But when the state audited the program in 2000, the results were incredibly discouraging: employees were making bad investment after bad investment. So in 2003, Nebraska eliminated employee choice from its 401(k) plan.

forums.washingtonpost.com...

Question, "I have personally known individuals that have become millionaires with long term investing in the stock market."

"Anybody can make money in the stock market, not just the privileged
inside group."

--------

Yes, anybody can win in stock market. It's junk words. You can also say, anybody can win lotto or anybody can win in casino. The fact is, only a few of them can win. Yes, you may know someone became millinare after investing in stock market for a long time. I don't have to know somebody personally but I am sure there is a millinare each week after lotto giving out a prize list. You don't have to wait long, each week you'll have one. The problem is, when there is a millinare, there will be one million losers. Only the proportion of that winning and losing is not so evident in stock market.

The share price is supported by investment fund. A one hundred share market supported by 100 dollars will result one dollar/share. If someone sold the share at 1.50/share, someone else would have to bear that o.50 loss sometime later. Because nobody will pay for the winner except investors. The principle is the same as in casino.

Now Bush tries to drive 12 trillion s.s. fund into stock market. After 2 trillion was taken away as adminstration fee, only 10 trillion was left for investors. If there are 12 investors, two left with two trillion each, than how many for the rest investors? 6 trillions for the rest 10 investors. They lost 40% of their investment. The point is nobody will supply the money winner got but other investors. It was neither from Bush nor government. It was from investment fund.

Compare with 12 trillion S.S. fund now invested in national bonds. (The adminstration fee is low, less then 1%.) So at last each one has its fund back.

(I here omitted interest income of bonds and divident from stock market. They are almost same.)