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SallyGrowler

Government Jobs Anyone? Forget about retirement...

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Public-sector pensions in New Jersey and other states completely ignore the dangers to taxpayers of investing in increasingly risky assets.

 

Northwestern University's Joshua Rauh projects that, in addition to the New Jersey, Illinois, Connecticut, and Indiana pensions that could run short before 2020, another 16 states could run out of funds by 2025.

 

http://www.american.com/archive/2010...pension-crisis

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The guy at Radio Free NJ brings it closer to home:

The state cannot get 'off the hook' for liabilities under current law, and these benefits are absolutely committed to the civil service unions. So what do you imagine will happen to the broader NJ State finances when these dates come rolling around? I'll tell you...eventually, 100% of all of our taxes will be committed by law to keeping geriatric union members reclining in luxury. There will be no more money for silly luxuries like policemen, or courts and prisons, or anything else the state does.

 

To me this looks very much like when the doctor finally breaks medical protocol and not only tells you that 'yes it's cancer' but he also breaks down and tells you how long you have. And since a great many states are in exactly the same position as NJ, and the governments of Europe are considerably worse off, unless the law changes what we're looking at here is the probable 'drop dead date' on western civilization.

I'll tell you another secret...at present the financial markets are in a binary state. The full reasons for this are complicated, but it has to do with the way a higher percentage of short term investment creates market conditions that make longer term investment increasingly difficult for professional investors. So unless the US treasury and the FED decide to commit re-inflating them (a choice with it's own set of dire consequences just a little further down the road) then the markets will de-leverage pretty dramatically in the next few months, and all of these numbers can be bumped forward in time by about 5 years.

 

and coincidentally - I'm now looking at my fresh new copy of Bloomber Markets... the cover story:

 

Why Bill Gross likes Stocks!

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The ugly truth is no matter where you go - this is gonna followfrown.gif

 

 

So running the course - the Fed predicts it'll take 5-6 years for the economy to "get back to normal" and now the "experts" are saying 5 years is the expiration date on government milk (not just NJ, but in every state).

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View PostThe ugly truth is no matter where you go - this is gonna followfrown.gif

 

 

 

 

In CA, by law, taxpayers must replenish the state employees' retirement fund when it falls below a certain amount.

 

A few weeks ago it was reported that CA taxpayers would have to pay $4 billion into the fund.

 

clapping.gif "government milk" clapping.gif

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This is the other shoe waiting to drop that will finish our economic collapse.

 

There is no more money.

 

Up here in CT the public pension fund is grossly underfunded and our state govenment continues to ignor the impending crisis.

 

Hell, the CT legislature just borrowed 1 billion dollars to make up a budget shortfall and claims we have a balanced budget.

 

We are at the edge looking down and can't see the bottom with our government telling us to please step forward, trust us.

 

This ones going to hurt far worse that anything we have ever experienced.

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Everything is gonna be just fine, the government wouldn't let that happen right?

 

I'll bet you the clowns retiring from the house and senate will never lose their benefits.

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View PostEverything is gonna be just fine, the government wouldn't let that happen right?

 

I'll bet you the clowns retiring from the house and senate will never lose their benefits.

 

 

They will iff there are no funds to back the benefits.

 

The only way would be to raise taxes to astronomic levels across the board, or introduce VAT to cover a smidgeon of the float.

 

State Gov and Fed gove can no longer provide bene's.

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The answer is simple, declare bankrupcy and rewrite the rules.

In the end it cannot be avoided.

 

It was advised for GM to go bankrupt and rewrite the union contracts but Obama took the other tack and gave it to the unions, it will still go bankrupt. Same destination even if by the scenic route.

 

America is on a collision course with life.

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The plain and simple is that taxes are going up... way up.

 

Met with the financial planner yesterday. His advice was to move the 401K to a ROTH and pay the tax now (while hoping they don't screw with the ROTH rules sometime down the road).

 

His assessment is that the old paradigm of being in a lower tax bracket in retirement probably won't hold true... he thinks even in retirement, the tax rates will be higher than they are now.

 

Eventually the devil gets his due.

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