http://market-ticker.denninger.net/archives/759-Here-It-Comes.html
or http://tinyurl.com/c28htw - - - We stand on the edge of the failure of all of American's retirement assets. Literally all of them. Buried in some of the earnings reports of the last quarter are the fact that half of the market capitalization of some firms was wiped out in the last year due to pension fund shortfalls as a consequence of the stock and credit market swoon. CALPERS and other funds are rapidly going from being adequately capitalized to critically undercapitalized. If the Treasury and Stock market both sell off as I believe both can and is likely to happen if the current policies are continued essentially ALL American Retirement Assets will be destroyed - 401ks, IRAs and both private and public Pension systems. Total losses through these systems is likely to reach 80-90%, and the Boomers start retiring "en-masse" just a few years from now. In short, if policies are not changed now there will be no retirement for Americans and the currently-retired who rely on these funds will find them gone and be forced back into the workplace. Unemployment in that scenario is likely to reach and may exceed 20%, and what's worse, Medicare funding will be severely curtailed at the same time due to the inability of the government to fund it. It is absolutely critical that Obama and Congress understand these facts (and they really are simple; we have $53 trillion in public and private debt - that is, credit - and yet the monetary base is just shy of $2 trillion up from the "normal" $800 billion or so) - it is not mathematically possible for a $2 trillion dollar thing to control the outcome of a $53 trillion thing, especially when you are threatening to add $7 trillion to it. Let me put forward a different view of what should be done, and hope that President Obama and his cabinet direct Geithner and company to take these actions. I fully realize that parts of this call for Geither to "turn on" some of his banking buddies, but irrespective of his desire not to, if he does not then the plan will fail. - - - Well, I for one am encouraged by the fact we have an admitted tax cheat for Treasury Secretary now, and Obama has nominated two other admitted tax cheats besides for other cabinet and administration positions of considerable power (Daschle and Killefer, his "Performance Czar," both of whom have since had to withdraw after getting caught red-handed with huge unpaid tax bills). I can only conclude that it must be a nomination requirement of some kind---after all, they had the most stringent vetting process in the history of the world to ensure only folks Obama considers ethical were chosen. Change You Can Believe In. (Echo: Just words. Just speeches.) On a more serious note, the article is very long, rather detailed, and spot on. Scary too, but makes some eye-opening recommendations that, sadly, make too much sense. - Bob _______________________________________________ Post Messages to: [email protected] Subscription Maintenance: http://leafe.com/mailman/listinfo/profox OT-free version of this list: http://leafe.com/mailman/listinfo/profoxtech Searchable Archive: http://leafe.com/archives/search/profox This message: http://leafe.com/archives/byMID/profox/[email protected] ** All postings, unless explicitly stated otherwise, are the opinions of the author, and do not constitute legal or medical advice. This statement is added to the messages for those lawyers who are too stupid to see the obvious.
