http://www.lewrockwell.com/hein/
hein160.html
http://tinyurl.com/334mny
The Big Unknown
by Paul Hein
***Begin Quote***
For example, no one at the bargaining table is going to interrupt proceedings to ascertain what, precisely, is meant by “hour.” The discussions will not hang on what is meant by “week,” or “year.” Common sense dictates you don’t quibble over words that have a universally understood meaning. Sadly, that also seems to include the word “dollar,” although no one sitting around the negotiating table could define it.
***AND***
And simple curiosity would prompt one to ask why this inability to define one of the most basic units in society should exist. Why cannot “dollar” be defined with as much precision as “quart” or “pound?” The only conceivable answer, I think, is that “quart” and “pound” measure something. No one goes to the store to buy a quart, or a pound, but only a quart of milk, or a pound of potatoes. But “dollar?” Of what is the dollar a unit? In general, of course, the answer is money. And what is that? Once, it was silver, and for a while, gold. Today it is nothing.
***End Quote***
And, in a nutshell, the author has expressed eloquently my problem with planning in the “modern economy”. Now I don’t think I am a doom or gloomer. Not too much! But, I can see all the clouds on the horizon. Of all the risks facing a retiree, there are several 800 pound gorillas.
Will the USA break the promises it makes?
A retiree has a lot “invested” with gooferment. Certainly it violates the 5% rule.
The Social Security Insurance ponzi scheme has several components in that promise: the defined benefit amount, the retirement age, Medicare health care benefit, what it covers, the Medicare drug benefit, and the taxability of the benefits.
The gooferment can also easily upset the planning by messing with inflation, taxation, and regulation.
The deficit, the debt, and the continued “buying votes with future benefits” are all going to the road to perdition at a quickening pace.
Finally, one has to recognize that the gooferment permits “under funding”. Corporations under fund their pension plans. Gooferment itself under funds the pension and medical benefits promised to its own gooferment employees. And, by its involvement in healthcare and drugs, it “under funds” what the marketplace would normally direct to those “silver bullets”. (Drugs are cheaper than hospitalizations. Healthy people are productive people. Nursing homes for “indigents” are obscenely expensive. And Alzhiemer’s, Parkinson, and senility destroys everyone.)
So how does the old fogy invest in this climate. Assuming that you’ve done proper planning, you’re doing a lot of investing. But, if you come upon a windfall, what do you do.
I’m a gold bug. No bones about it.
Of all the things that the gooferment can do to upset my apple cart, the big ones are changing tax policy, “adjusting” the taxability of benefits, and adding a means test to benefits.
So you want to have enough assets for a comfortable retirement, but perhaps you don’t want to have too much on paper?
Like the “medicare trusts” of today’s planners, you have to think ahead. A medicare trust is where the assets are put in trust to get them excluded from the medicare eligibility calculation. People use it to get their old relative’s nursing home paid for by the gooferment and preserve the old relative’s estate that gets passed to their heirs. Dirty pool, but legal.
But, when all these “blank checks” come due, maybe it might pay to have assets that don’t show up on paper anywhere.
Bullion coins!?!
They don’t earn interest. They don’t take up a lot of space. They certainly don’t depreciate with inflation. AND, the don’t show up on any statement or tax return.
A coffee can, a shovel, and a planter!
It won’t be the treasure of the Count of Monte Cristo. But, it might be the difference between being poor and being secure.
Posted by reinkefj 
You must be logged in to post a comment.