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Old 11-10-2011, 09:27 AM   #1
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Exclamation Warning to pensioners

Quote :
... The big money manager - Blackrock (many of you probably have retirment funds being managed by Blackrock) - has been accumulating a giant position in Italian Government bonds. ... If you have retirement funds being kept by your advisor or pension plan at Blackrock, you might want to think about liquidating your account and getting the money out before Blackrock turns into the next MF Global times 100. I'm not kidding about this.
More: http://truthingold.blogspot.com/2011/11/roflmao_09.html

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Old 11-10-2011, 10:41 AM   #2
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People depending on others for their pensions are in great danger! Social Security and other entitlements are programs in big trouble (unless they hyperinflate).

As you note, PMBug, there are a lot of custodians of other people's money that are dishonest or otherwise have risky bets (Blackrock is the latter). There are other cockroaches that will likely appear as I cannot believe that MF Global is the only one.

The ETFs like GLD have big question marks associated with them as well.

Finally, the IRAs and 401k's are at risk for an "Argentina style" .gov plucking. Disclosure: I closed my IRA in late 2008, paid my penalties and taxes, and bought physical GOLD with much of the remainder.

In view of all of the above, prudence alone requires most of us to have a decent-sized chunk of gold for protection. Especially anyone with children...



(your new article is only rated 4 Nuggets because I just got an error message saying I could not put in 5, LOL...)

Last edited by DoChenRollingBearing; 11-10-2011 at 10:42 AM. Reason: edits!
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Old 11-11-2011, 11:52 AM   #3
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Originally Posted by DoChenRollingBearing View Post:
Finally, the IRAs and 401k's are at risk for an "Argentina style" .gov plucking.
Good post.

Can you expand on your assertion above? Tell me more, please.

Also, I'm interested in this idea:

Quote :
Disclosure: I closed my IRA in late 2008, paid my penalties and taxes, and bought physical GOLD with much of the remainder.
How did this work out for you? Did you have a ton of tax to pay?
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Old 11-11-2011, 12:17 PM   #4
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Originally Posted by DoChenRollingBearing View Post:
...
Finally, the IRAs and 401k's are at risk for an "Argentina style" .gov plucking.
...
Originally Posted by vox View Post:
...
Can you expand on your assertion above? Tell me more, please.
...
October 22, 2008:
Quote :
Hemmed in by the global financial squeeze and commodities slump, Argentina's leftist government has seemingly found a novel way to find the money to stay afloat: cracking open the piggybank of the nation's private pension system.

The government proposed to nationalize the private pensions, which would provide it with much of the cash it needs to meet debt payments and avoid a second default this decade.
...
More: http://online.wsj.com/article/SB122460155879054331.html

Argentina wasn't the only one that did this:

June 12, 2011:
Quote :
THE GOVERNMENT WILL use the last €5 billion in the National Pensions Reserve Fund (NPRF) to help create employment although it will need approval from the International Monetary Fund (IMF) and Europe before doing so.

The Sunday Times reports today that the money will be used by the government to create as many as 80,000 jobs in Ireland. The paper cites government sources in reporting that the use of the money would be seen as more viable then the proposed sale of semi-state assets in the current weak market.
...
More: http://www.businessinsider.com/irela...loyment-2011-6

And, the idea has been floated here in the USA a couple times already:

January 8, 2010:
Quote :
...
The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams, according to Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry, who are leading the effort.
...
http://www.bloomberg.com/apps/news?p...d=aR9zVMXzOeX0

May 13, 2011:
Quote :
Last month, I discussed why I'm not as excited about Roth IRAs as many people who write about consumer finance: I don't believe that the government is ultimately going to be able to keep it's hands off a pretty big pot of money. Getting a tax break now in your 401(k) or traditional IRA is guaranteed; getting a tax break in the future is not.
...
More: http://www.thefiscaltimes.com/Articl...RAs.aspx#page1

The US Treasury has already dipped into the public pension funds back before the first contested debt ceiling debate when they were already beyond the limit.

May 21, 2011:
Quote :
...
As Congress squares off over a debt ceiling vote, Treasury is scrambling to find cash in the couch cushions. One of the ways it will scare up extra money is by putting off saving for the retirements of federal workers — in effect, short-term “borrowing” from public pension funds.

By suspending investments into the civil service retirement and disability fund, as well as putting off reinvestments into another big retirement bucket known as the G-Fund, Treasury could “claw back” up to $202 billion, estimates Reuters. That sounds like a lot, but it’s just 10 percent of the $2 trillion the agency says it needs to stay afloat until after Election Day 2012, and it will have to be put back.

Holding off public pension payments could be cast as prudent short-term scrambling to avoid a serious problem with U.S. Treasury holders. Taken another way, such moves could instead be seen as the first step toward an eventual tax or outright seizure of private savings in tax-favored retirement plans.
...
http://www.newsmax.com/Headline/Pens...5/21/id/397212

I don't think there is any imminent danger of this, but if the debt ceiling is ever given meaning (and not just raised every time it's in danger of being breached), this would become a real concern - especially if the Federal government doesn't start making any real, significant spending cuts.
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Old 11-11-2011, 01:49 PM   #5
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@ vox

Re Argentina, I do not have the details handy, but I believe they did two things over the past few years:

1) seized dollars (in bank accounts) and then devalued their currency

2) seized pensions by forcing the accounts to hold long term Arg. bonds.

I THINK that is what happened.

---

Re cashing in my IRA, yes I did that late in 2008. I had to pay capital gains tax as well as a 10% penalty for cashing it in early (I am 55). Because I sold a LOT of stock (most before September, whew!) and had decent income in 2008, I paid the MOST I ever have in income tax in 2009. It was very ugly to write that check...

But, that now means that I am not vulnerable to a seizure or forced conversion of a pension. And I have read various times that such pensions are the last of the BIG pieces of low hanging fruit (in terms of .gov rounding up some money).

PLEASE do your own due diligence, as I do not recall all the facts and am no expert!

---

I like that avatar...
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Old 04-24-2012, 08:18 AM   #6
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Quote :
...
Capitol Hill politicians are assessing tax changes that could let the Internal Revenue Service lay claim to a portion of the $18 trillion sitting in 401(k) accounts and other tax breaks used by middle-class workers, including cutting the mortgage tax deduction.

A commission looking for ways to close the deficit, and, noting the extent of 401(k) tax breaks, recommends an examination of the system as one way to prevent government bankruptcy.
...
http://www.nypost.com/p/news/busines...lVsEIJj2IVgHuK
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Old 04-24-2012, 09:27 AM   #7
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So, if they seized all 401-K money, they could pay off the debt and start over again. That would, however, cause a revolution, which I believe they are trying to avoid. One thing they could do is allow those who are above a certain age, say 50 or so, to dip in to their funds but only impose a modest penalty of three or four percent. I suspect that hundreds of billions of dollars would then be disgorged and used, and the GovCo would have instant revenue, as they could require payment of estimated taxes at the point of withdrawl. This would allow them to pull some tax money forward, which buys them some time, but doesn't immediately appear to be outright confiscation or looting.
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Old 04-24-2012, 12:59 PM   #8
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Straight out of "Coming Generational Storm"...




Burns says in the book that any tax-deferred vehicle has a defacto lien against it from the Feds.
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Old 04-24-2012, 01:13 PM   #9
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Originally Posted by ancona View Post:
So, if they seized all 401-K money, they could pay off the debt and start over again. That would, however, cause a revolution, which I believe they are trying to avoid. One thing they could do is allow those who are above a certain age, say 50 or so, to dip in to their funds but only impose a modest penalty of three or four percent. I suspect that hundreds of billions of dollars would then be disgorged and used, and the GovCo would have instant revenue, as they could require payment of estimated taxes at the point of withdrawl. This would allow them to pull some tax money forward, which buys them some time, but doesn't immediately appear to be outright confiscation or looting.
Based no what other countries have done in the past, I would not be suprised if our "patriotic duty" will be to have our 401k/IRA swapped out for long term treasury bonds.
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Old 04-25-2012, 08:05 AM   #10
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I've cashed out 401k's twice... and payed heavy penalties both times. The first cash-out was for a house purchase, the second for medical, however both times neither condition met with the fed's exceptions for avoiding tax on the distributions.

My new company contributes a portion to a 401k whether I like it or not (ok, I'll take it!) --- so I now have a new 401k. However, I decided not to contribute for the following reasons:

1. I'll be damned if I am taxed and penalized on my own money again.
2. I'm purely investing in land, PMs, and various business opportunities (ie., quick cash turn around) with my "contribution" now.
3. I would like to retire before the feds "approved" retirement age.

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Old 04-25-2012, 10:24 AM   #11
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The best retirement plan is one where you are in charge of it yourself. Outside the system.

We cannot know the details of the future, but we can know the trends and basic principles that span generations, and make decisions accordingly.

I strongly advise against any registered retirement plans and bank investments. The rate of of return is nowhere near acceptable for the risk.
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Old 11-17-2012, 09:28 AM   #12
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Quote :
A recent hearing sponsored by the Treasury and Labor Departments marked the beginning of the Obama Administration’s effort to nationalize the nation’s pension system and to eliminate private retirement accounts including IRA’s and 401k plans, NSC is warning.
...
http://www.nationalseniorscouncil.or...rity&Itemid=62
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Old 11-17-2012, 11:04 AM   #13
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Originally Posted by vox View Post:
Good post.

Can you expand on your assertion above? Tell me more, please.

Also, I'm interested in this idea:



How did this work out for you? Did you have a ton of tax to pay?
Vox - I cashed in all mine over 10 years ago. I did it strategically then but still, paying the tax is less of a loss than losing it all.

Besides, you still pay tax whenever you do take it out and tax rates never go down, they always go up. Retirement funds are one of the most misunderstood (by the average person who invests in them) investments of all. You do not get out of paying taxes, you only DEFER paying them.

I 'saw the light' long ago and acted. And yes, I am glad I did.
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Old 11-17-2012, 07:38 PM   #14
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Originally Posted by Jetstream View Post:
Vox - I cashed in all mine over 10 years ago. I did it strategically then but still, paying the tax is less of a loss than losing it all.

Besides, you still pay tax whenever you do take it out and tax rates never go down, they always go up. Retirement funds are one of the most misunderstood (by the average person who invests in them) investments of all. You do not get out of paying taxes, you only DEFER paying them.

I 'saw the light' long ago and acted. And yes, I am glad I did.
here ya go:
http://investmentwatchblog.com/obama...ntWatchBlog%29
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Old 11-18-2012, 08:38 AM   #15
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Jay - that's the same article that I mentioned in post #12.
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Old 11-18-2012, 02:14 PM   #16
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Originally Posted by PMBug View Post:
Jay - that's the same article that I mentioned in post #12.
PMB. ooooppps....
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Old 11-19-2012, 08:31 AM   #17
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Dave in Denver says the push to confiscate IRAs/401ks started long before the Jan 2010 drumbeat mentioned in post #4:
Quote :
... The IRA confiscation movement started at least during, if not before, the Bush administration. Four years before the recent hearing sponsored by the Treasury/Labor Dept, there was a Congressional hearing On October 7, 2008 sponsored by the House Education and Labor Committee at which pension reform academic Teresa Ghilariducci presented a paper on her Guaranteed Retirement Account program. Her idea is to replace IRA/401k accounts with a Government administered program which would provide retirees with a guaranteed annuity stream annuitized by good old U.S. Treasuries.
...
This movement to de facto seize your private retirement plan was started years before Obama was even a local politician in Chicago. Regardless, once these movements begin in the Government they happen slowly and then all at once (sound familiar?). Anyone with two operational frontal lobes will do what I did 6 years ago and cash out their IRA, pay the 10% penalty plus any income tax for that year on the proceeds and put the money into physical gold and silver outside of the system. Over the next 4-5 years you will more than make up for the 10% penalty/taxes with the appreciation of the bullion AND your wealth will be safe from the Government. Capito?
http://truthingold.blogspot.com/2012...on-coming.html
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Old 11-19-2012, 08:38 AM   #18
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I don't know of this is new news or not, but according to an accountant buddy on the federal-government level, "the pensions of federal employees have already been collateralized and replaced with IOUs." Those were his exact words.
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Old 11-19-2012, 08:42 AM   #19
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...there's more problems with "govt approved" private pensions, than one could care to count...

That is even true with private insurance. The industry is SO heavily regulated, that insurers have very little leeway (in my opinion), in what they are allowed invest the premiums in.

Certainly, keeping interest rates at zero, doesn't help their business, too.

Next thing, given today's (and tomorrow's) money printing rates, and massaged statistics (inflation), it is next to impossible to even PLAN financially one's retirement. How much "accounting units" (money) you need to put aside? How big your "nest" need to be, when retiring 10, 20 years from now? What costs of living one shall expect??? No chance in hell, that anyone can predict it with ANY degree of credibility.

Next thing - fees and commissions of the pension funds. I think they are the only players, who make ANY real money in that puzzle. If my fund is making, say, 3% a year gain, but their commission is, say, 1% - they are taking away fecking 33.3% of my gains. They are very well replacing the government taxes on capital gains, and with handsome excess (and let's do not forget, I'll need to pay government taxes as well on the bulk sum, when I withdraw the funds later on).
And that is even without asking them about their "sophisticated investment strategy", how they are managing my money?? Well, it turns out, after a little digging - the feckers are just investing in basked that is as close to market index as possible. Well I can write a program in probably two days (that includes testing), that would do the same for me, for free, thank you very much!

Next, another assumption is, that while contributing to your pension fund, "one is tax-exempt at his today's tax bracket rate, and will be using the money later at his tomorrow's tax bracket rate" - presumption being, that tomorrow's rate will be lower (pensioners are usually not getting into upper brackets of income). Well that might be questionable, too - when the progressive income tax rate were introduced few decades back, only really wealthy people were caught in the highest bracket. Today, most of the so-called middle class, gets caught in the highest bracket at some stage of the fiscal year. And the trend, of course, is creeping in - so it is not impossible, that before some of us get retired in say 20, 30 years time - the costs of living will increase so much in the meantime, thanks to the depreciating currencies, that ANYBODY living of his own funds (and not government food stamps), will find himself in the highest income tax bracket.

that's only for starters and to kickstart some thinking.

Personally, I do not spent a DIME of my own money on bullshit schemes like that - and whatever contributed by my company, I will be cashing in periodically, and convert into something that has a chance to provide me with some food on my table, when I am old.
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Old 11-19-2012, 09:00 AM   #20
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Originally Posted by mike View Post:
I don't know of this is new news or not, but according to an accountant buddy on the federal-government level, "the pensions of federal employees have already been collateralized and replaced with IOUs." Those were his exact words.
Old news. It's what kept government running during the last stand-off over raising the debt ceiling. Timmy had to raid government pensions after the debt ceiling was reached. This was widely reported in the MSM:
Quote :
...
Treasury Secretary Tim Geithner has informed members of Congress that, with the U.S. government reaching its $14.3 trillion debt ceiling Monday, his department will have to turn to a string of last-resort measures so that the government can keep paying its bills. At the top of the list is a plan to suspend investments to two government employee retirement funds, while borrowing from one of them.

Geithner stressed that the move will not affect federal workers and retirees and that the accounts will be "made whole" once the debt limit is increased. But he ratcheted up his call for Congress to take action soon.
...
http://www.foxnews.com/politics/2011...h-budget-deal/

and in more detail by ZH:

http://www.zerohedge.com/article/its...43-billion-ret
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