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Re: Annuities and Social Security
Old 12-15-2005, 09:43 AM   #41
 
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Re: Annuities and Social Security

Quote:
Originally Posted by brewer12345
MN, give it a rest. *Don't quote me out of context and I won't point out that you appear to be both rude and wet behind the ears.
Those are your words. *That is in context. *"Just cut to the chase and buy from a single company." *

Telling Greg he was having daranged fantasies was rude. *Telling Greg he was waiting for a meteor strike was rude. * *



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Re: Annuities and Social Security
Old 12-15-2005, 09:48 AM   #42
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Re: Annuities and Social Security

Quote:
Originally Posted by brewer12345
JG, my comment was in the context of grumpy's annuity, which appears to be a very small part of his net worth.

Its not hard to pick a company that won't fail unless the entire financial system or our society goes kablooie. *If that happens, you will be a lot more worried about eating and staying alive than your monthly annuity check.
Okay. I agree with this.

JG
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Re: Annuities and Social Security
Old 12-15-2005, 09:50 AM   #43
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Re: Annuities and Social Security

Quote:
Originally Posted by wildcat
MN -

We like and appreciate Brew's advice.* He has never crosses any boundaries and is very well respected.* It would be great if you could chill out a bit and ease into the posting process instead of trying to ruffle feathers.
Actually, I did get pissed off at Azanon and unload on him, so I'm not sure you could say I have never crossed boundaries (not that I regret telling that little pisher off).

I'm going to be magnanimous and let this one go with MN. *I think Greg knows that I am a fellow traveler WRT the scary outlook for the market and economy and that I respect him. *I just disagree on the use of gold as some sort of universal constant. *Having said that, restricting Au (or anything) to 10% of your portfolio is unlikely to ever cause any serious harm.
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Re: Annuities and Social Security
Old 12-15-2005, 09:59 AM   #44
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Re: Annuities and Social Security

Quote:
Originally Posted by Marketneutral
Telling Greg he was having daranged fantasies was rude. Telling Greg he was waiting for a meteor strike was rude.
Well actually Greg and I are waiting and a hoping for a meteor or an asteroid to come our way, so we can test out our new Starship Enterprise!

Quote:
Originally Posted by DanTien

Humans live in a vast solar system where 2,000 feet seems a razor-thin distance.

Yet it's just wide enough to trigger concerns that an asteroid due to buzz Earth on April 13, 2029 may shift its orbit enough to return and strike the planet seven years later.

Scene: Starship USS Enterprise on mission to alter asteroid's course

Kirk: Captain's log, stardate 2029 - 0 - 4 - point - 12.
Our mission, to intercept Asteroid "99942 Apophis", nudge it off-course to avoid a disasterous impact on earth...

Chekov: "I think we're in a lot of trouble."
Kirk: "That's a great help Mr. Chekov. Bones?"
Bones: "Well I think Mr Chekov is right, we are in a lot of trouble."
Kirk: "Spock? And if you say we're in a lot of trouble..."
Spock: "We are captain. We're in a heap of a lot of trouble"

Scotty: Captain! What do we do?

Kirk: Sulu, forward phasers?
Sulu: "Forward phasers locked and ready to fire sir."

Spock: "Without facts, the decision cannot be made logically. You must rely on your human intuition."

Kirk: Scotty, full power.
Scotty: Aye Captain.
Kirk: "Scotty. As good as your word."
Scotty: "Ay sir. The more they overtake the plumbing, the easier it is to stop up the drain."
Spock: "Fascinating!"
Bones: "Are you out of your Vulcan mind, do you know what Scotty's talking about?"

Kirk: Scotty, your background with the Glascow Rangers soccer club makes you ideal for solving this problem, I've decided that using phasers may jeopardize the ship. I want to beam you on to the asteroid and have you nudge it some, like say about half a mile or so....
Scotty: Aye, Sir. A bit like soccer hey captain? Except I'll be kicking an asteroid....

Computer: "Level please."
Scotty: "Tranporter room."
Computer: "Thankyou."
Scotty: "Up your shaft!"
Quote:
Originally Posted by Apocalypse . . .um . . .SOON

After the commercial:

Scotty: It didn't work! What do we do now?
sub-sergeant Tien: I've got an idea. Let's stick Spock's head out the window, and he can do a mind-meld with the asteriod as we go by and then pull it off course.
Bones: Great idea Tien. It's . . . it's . . . like a tractor beam.
Kirk: Make it so! (oops, wrong show)
Sub-sub corporal Greg: He needs a hat or it won't work.
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Re: Annuities and Social Security
Old 12-15-2005, 10:03 AM   #45
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Re: Annuities and Social Security

MN,

One of the problems is you keep saying 'plan for the worse and hope for the best'....

I doubt if you have planned for the worse.... nobody really does.. and you being as young as you are you can not possiibly know what inflation will be in 30 to 40 years.... a 1/2% difference can make a huge difference down the road...

What would happen to your retirement if the stock market dropped 40% next year and never recovered... and inflation shot up to 15%? *Can you live another 60 years on what you would have left?

What would happen if for some reason we had hyper-inflation? *It has happened to third world countries... so that is the worse... *way back when in Argentina people were paid twice a day because they needed to go buy things before the price went up later that day? *
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Re: Annuities and Social Security
Old 12-15-2005, 10:08 AM   #46
 
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Re: Annuities and Social Security

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Originally Posted by Texas Proud
MN,

One of the problems is you keep saying 'plan for the worse and hope for the best'....

I doubt if you have planned for the worse.... nobody really does.. and you being as young as you are you can not possiibly know what inflation will be in 30 to 40 years.... a 1/2% difference can make a huge difference down the road...

What would happen to your retirement if the stock market dropped 40% next year and never recovered... and inflation shot up to 15%? *Can you live another 60 years on what you would have left?

What would happen if for some reason we had hyper-inflation? *It has happened to third world countries... so that is the worse... *way back when in Argentina people were paid twice a day because they needed to go buy things before the price went up later that day? *
I am positioned to profit from all these scenarios.

I am better at playing the short side of the market.

Some countries that have experienced hyperinflation were running debts less to their GDP then we are.

As long as we invade countries that want to stop taking USDs for their oil we will be ok.
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Re: Annuities and Social Security
Old 12-15-2005, 11:21 AM   #47
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Re: Annuities and Social Security

Quote:
Originally Posted by Marketneutral
If the COLA index is going to undercut the true inflation rate by 2-5% a year by the time you retire your SS will not matter.* . . .
Where do you get figures like that?

Planning for the downside makes sense. There have been a lot of folks with political motives trying to convince people that ss is going to go away and that CPI grossly underestimates inflation. The facts tell a slightly different story. SS is likely to get wittled down -- maybe as much as 25%. Some estimates indicate it won't be that bad. If, sooner or later, legislators modify the ss tax/benefit equations, the required reductions in ss would be even less. We've talked about CPI and inflation on this board several times. There are a lot of posters that seem to think that CPI is a vast government conspiracy to cover up the true inflation rate. You won't have any trouble finding journalists and think-tankers that will support this idea. But the US BLS is incredibly transparent and open about CPI. Go to their web site and you can find months worth of reading material in the form of their studies, surveys, methods, data, etc. There are plenty of reasons why any particular individual's personal inflation rate will be different than CPI. You can find articles on the BLS site that talk about these reasons. I'm convinced that the CPI methods are very sophisticated and well-motivated.

So, plan for the downside. But planning for worse than that will simply cause you to have to work longer or deprive yourself of things you could really be enjoying while you're younger.
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Re: Annuities and Social Security
Old 12-15-2005, 11:33 AM   #48
 
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Re: Annuities and Social Security

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Originally Posted by ((^+^)) SG
Where do you get figures like that?* *

Planning for the downside makes sense.* There have been a lot of folks with political motives trying to convince people that ss is going to go away and that CPI grossly underestimates inflation.* The facts tell a slightly different story.* SS is likely to get wittled down -- maybe as much as 25%.* Some estimates indicate it won't be that bad.* If, sooner or later, legislators modify the ss tax/benefit equations, the required reductions in ss would be even less.* We've talked about CPI and inflation on this board several times.* There are a lot of posters that seem to think that CPI is a vast government conspiracy to cover up the true inflation rate.* You won't have any trouble finding journalists and think-tankers that will support this idea.* But the US BLS is incredibly transparent and open about CPI.* Go to their web site and you can find months worth of reading material in the form of their studies, surveys, methods, data, etc.* There are plenty of reasons why any particular individual's personal inflation rate will be different than CPI.* You can find articles on the BLS site that talk about these reasons.* I'm convinced that the CPI methods are very sophisticated and well-motivated.*

So, plan for the downside.* But planning for worse than that will simply cause you to have to work longer or deprive yourself of things you could really be enjoying while you're younger.* *
COLA increase 4.1%
Government I Bonds 6.73%

We know that the govt massages the economic data so they can pay less interest.

I believe inflation is double digits now but food, energy and housing do not count. And when housing counts it is based on being a renter. No property tax and less insurance.

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Re: Annuities and Social Security
Old 12-15-2005, 11:37 AM   #49
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Re: Annuities and Social Security

Quote:
Originally Posted by Marketneutral
COLA increase 4.1%
Government I Bonds 6.73%

We know that the govt massages the economic data so they can pay less interest.

I believe inflation is double digits now but food, energy and housing do not count.* And when housing counts it is based on being a renter.* No property tax and less insurance.

Couple of probmlems with that comparison. A) i-bonds include an additional 1% yield over inflation, B) I suspect you are quoting an annual CPI number vs. a 6month I-bond annualized yield.
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Re: Annuities and Social Security
Old 12-15-2005, 11:48 AM   #50
 
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Re: Annuities and Social Security

Quote:
Originally Posted by brewer12345
Couple of probmlems with that comparison.* A) i-bonds include an additional 1% yield over inflation, B) I suspect you are quoting an annual CPI number vs. a 6month I-bond annualized yield.
Good point about the other 1%.

I still believe 4.1% is way low as a COLA increase.

Interesting reading here:
http://www.bls.gov/cpi/cpifact5.htm

Talk about brain freeze material.

God bless Hedonic and Seasonility Adjusted Accounting Practices! Great interest saver.

I just want to shop where these BLS guys do. :P
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Re: Annuities and Social Security
Old 12-15-2005, 11:49 AM   #51
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Re: Annuities and Social Security

MarketNeutral, welcome to the board. I think. In the two days since you joined us you have contributed 60 posts. Why don't you take some time and tell us a bit about yourself? I find it much easier to tell where someone is coming from and much easier to evaluate what someone says when I know a bit about them.
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Re: Annuities and Social Security
Old 12-15-2005, 12:06 PM   #52
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Re: Annuities and Social Security

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Originally Posted by Martha
MarketNeutral, welcome to the board.* I think.* * In the two days since you joined us you have contributed 60 posts.* Why don't you take some time and tell us a bit about yourself?* I find it much easier to tell where someone is coming from and much easier to evaluate what someone says when I know a bit about them.*
I'm tempted to believe MN is a morph of Az. Same snarky, combative style...
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Re: Annuities and Social Security
Old 12-15-2005, 12:08 PM   #53
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Re: Annuities and Social Security

Oh oh Marketneutral, better check your chute!

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Re: Annuities and Social Security
Old 12-15-2005, 12:36 PM   #54
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Re: Annuities and Social Security

Quote:
Originally Posted by Marketneutral
COLA increase 4.1%
Government I Bonds 6.73%
Both of these use exactly the same measur of inflation, CPI-U. I-bonds include an additional fixed rate and are done on a 6 month basis.

Quote:
We know that the govt massages the economic data so they can pay less interest.
Here's that vast government conspiracy theory again. You may know this. But in all the research I was able to do, I couldn't find any indication that this is true. I believe that people who believe this should go to the BLS web site and spend a few hours looking at their papers, reports and data. The web site is poorly organized and difficult to negotiate, but the information is good.

Quote:
I believe inflation is double digits now but food, energy and housing do not count. And when housing counts it is based on being a renter. No property tax and less insurance.
Well, most of this is simply not true. While it is true that CPI considers a blend of renter and owner housing costs, that seems pretty reasonable since the Average American is a blend of owners and renters. The BLS spends a lot of time and energy trying to define the average person. They explain their methodology in reports and papers. They write explicitly what their breakdown of various baskets of goods is and go into gory detail on how each item is selected. They tell you where they go to price those items and if you haven't looked at this information, let me tell you -- it would be pretty hard to skew that data. The people who do all of this are civil servants, not administration lackeys.

People can believe the vast CPI government conspiracy if they want, but I have not seen the data to support this opinion.

Every once in a while, someone on this board posts their own personal inflation number and claims it is much higher than CPI. Of course if CPI were exactly accurate, we would expect about half of us would experience personal inflation rates that are higher than CPI. But I always ask the question, "How do you compute your personal inflation rate?" Unless you buy exactly the same thing every year, how can you possibly do that? I haven't heard a good answer yet.
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Re: Annuities and Social Security
Old 12-15-2005, 12:43 PM   #55
 
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Re: Annuities and Social Security

How many times have we heard that home ownership it at all time highs?

OK. Good luck with your investments.

And take care.
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Re: Annuities and Social Security
Old 12-15-2005, 12:47 PM   #56
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Re: Annuities and Social Security

Quote:
Originally Posted by brewer12345
I'm tempted to believe MN is a morph of Az.* Same snarky, combative style...
I'm with you there, except I'd say* the old Az.
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