Sunday, December 21, 2008
The Lost Decade - Where Did My Savings Go?
Unfortunately, we all tend to learn our lessons after the fact.
The one we are learning now is that "investing" into stocks is risky behavior. For many Americans, looking at their retirement account is like 1995 all over again - all those gains have evaporated.
I think we'd all be better off if we called "investing" by what it really is: buying financial products.
The word "investing" puts a twist on "buying" that takes all common sense out of our decisions. We start to think that when we "invest" we are doing something more grand, more guaranteed if you will, with less chances of failure.
If someone said to you: "Jane, would you like to buy a mattress" you would ask a lot of questions. How does the mattress compare to others on the market? Is there a guarantee against defects? Who makes the mattress? Now think about how many questions you ask when a "financial adviser" says you should "invest" in a stock.
Now if you would just substitute "financial advisor" to "salesman" and "invest" to "buy" think about how that changes the dynamic. You'll ask a lot more questions and keep more of your money.
Everyday more of us are realizing that the stock market is not a strategy for retirement at all, it is a Ponzi scheme which leaves hardworking savers holding the bag.
How did we become so enamored by the stock market? We'll cover that next time.
Labels:
401(k),
Ponzi,
retirement,
stock market
Wednesday, December 10, 2008
The Myth of Highly Paid U.S. Auto Workers
Saturday, December 06, 2008
U.S. Losing 500,000 jobs per month
The U.S. economy is losing 500,000 jobs per month.
The graphic at the left (courtesy of Paul Krugman) shows the ratio of employed to total population.
"By this measure it’s been a weak economy all along — and now it’s falling off a cliff," wrote Paul Krugman in his blog.
State Governors convening for their annual conference in Philadelphia reported that for every $1 billion in additional Federal government spending, 40,000 jobs would be created.
Just to erase the current rate of job loss, the investment required is $12.5 billion per month or $150 billion per year.
This is why providing U.S. automakers a loan is so crucial. But it needs to come with job preservation. This is no time to restructure on the backs of workers. Surely smart managers can figure out how to create innovate work schedules to preserve jobs.
Tuesday, December 02, 2008
Saving U.S. Auto Makers Only Makes Sense to Save Jobs
The next version of the "big 3" U.S. auto makers' request for a Federal bailout came into view today. Here's how much each company is requesting:
Republicans from President Bush to Senators Richard Shelby of Alabama and Jon Kyl of Arizona have ridiculed any bailout as throwing good money after bad.
Democrats Harry Reid and Nancy Pelosi has been on the other side saying “we want to see a commitment to the future."
If you work in the auto manufacturing or supply industry or are concerned about what bankruptcy will mean for hard working Americans, now's the time to make your voice heard. Write to your U.S. Representative or U.S. Senators and tell them that you support the use of Federal money as long as it also preserves U.S. jobs.
First time writing to the U.S. Congress? Here's a link about how to write a good letter.
- GM: $18 billion
- Ford: $9 billion
- Chrysler: $7 billion
Republicans from President Bush to Senators Richard Shelby of Alabama and Jon Kyl of Arizona have ridiculed any bailout as throwing good money after bad.
"Companies fail everyday and others take their place. I think this is a road we should not go down. They're not building the right products."But should families pay the price for bad management when we are in a recession and jobs are scarce? Is this not the time for government to step in? There seemed to be plenty of money to bailout Wall Street.
- Senator Richard Shelby.
Democrats Harry Reid and Nancy Pelosi has been on the other side saying “we want to see a commitment to the future."
"A restructured, competitive American automobile industry will continue to play a crucial role in our national economy and in the global marketplace."- Speaker Nancy Pelosi
If you work in the auto manufacturing or supply industry or are concerned about what bankruptcy will mean for hard working Americans, now's the time to make your voice heard. Write to your U.S. Representative or U.S. Senators and tell them that you support the use of Federal money as long as it also preserves U.S. jobs.
First time writing to the U.S. Congress? Here's a link about how to write a good letter.
Labels:
auto workers,
jobs,
U.S. auto makers
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