Doom and Gloom

[Helen]

I think I will be fine financially in retirement. I'm planning, saving and paying attention. However, I see a lot of dark clouds on the horizon.

I just read some Wall Street Journal articles on Bush's budget proposal. He's talking about cutting entitlement programs that benefit the poor and elderly (that's cold, man) while raising the budget to fund the war. I think this is the sign of things to come. If we aren't paying for the war, we will be paying to finance/pay down the debt while funding the ballooning entitlement programs.

I see pensions in the public and private sector that can't be sustained. Medicare benefits that are going to balloon. A huge trade and domestic deficit, negative savings rate, flat/inverted yield curve, high energy costs, a cut back in consumer spending, a war with no short term end in sight, and a housing bubble.

The yield curve and housing bubble are not just happening in America.

Am I being pessimistic or does it really seem probable that we are heading into economic hardships ?

Should I start my own Madam Cleo Economic hotline ? I really see trouble ahead.

-helen

 

[Wizard]

The cost of the war is not in the budget. They do seperate "emergency funding" adds on for that. They are doing one now (2006 budget - that was just signed) for $120B. Probably see a request for another $100B in September.

 

[REWahoo]

Should I start my own Madam Cleo Economic hotline ? I really see trouble ahead.

-helen

I think that's a great idea to supplement your retirement income. You certainly can't be any worse at it than the economic prognosticators we have today.

Be sure you use "Greenspanish" when you make your predictions. That way you can always say "See. I told you so!"

 

[setab]

Is "Greenspanish" anything like Espanol verde? I love the term, by the way, and I promise I am going to steal it!

setab

 

[REWahoo]

Is "Greenspanish" anything like Espanol verde? I love the term, by the way, and I promise I am going to steal it!

setab

Since I only understand a few words when either is spoken, they may very well be the same language.

And you're welcome.

 

[LOL!]

I just read some Wall Street Journal articles on Bush's budget proposal.

One thing is certain, Bush will not be president in a few years, so the extent of any damage he does will be limited.

In the meantime, you need to donate half your salary (or more) to the charities of your choice to combat his budget proposal. That's how you can help beat the doom and gloom.

 

[Helen]

In the meantime, you need to donate half your salary (or more) to the charities of your choice to combat his budget proposal.

Yes, I'm already doing that. I donate 42% of the household gross income to HERF (Helen's Early Retirement Foundation).

 

[cute fuzzy bunny]

Its always something Helen...inflation, nukes from the USSR, the cuban threat, stagflation, the fall of vietname, and now an inverted yield curve, a boggy war and potentially the candian menace.

Good thing I remembered to put that in there.

I guess the good news is that if you're ER'ed and disaster strikes, you wont have a job to lose, a workplace to bomb, and you'll be used to sitting at home trying to find stuff to entertain yourself with.

And you'll already know one good alternative use for vegetable oil!

 

[tryan]

Am I being pessimistic or does it really seem probable that we are heading into economic hardships ?

I think we can all agree an economic down-turn is forthcoming.  After all, the ecomony is cyclical and the last recession was one of the shortest on record ... so the bubbles inflated beyond the norm.  But when is anybody's guess.

Good news is, where there's chaos there's opportunity e.g. stock/housing firesales!  Those who position to capitalize on the downside will remain on top.

 

[alphabet soup]

I believe that the secret to all of these things is to continue saving.  Problems with pensions, negative savings, high energy costs, etc will be borne primarily by working folks.  Those who hold capital in this country are treated very well from a tax perspective so you don't need to worry about having to fund any of the problems you mentioned (and those capitalists don't need to go to work - woo-hoo!).  Capital can leave a country if it gets taxed too much, so the government generally goes after capitalists last when looking for revenue.  Workers generally cannot/will not leave the country, so they are the ones who end up holding the bag and paying for societal problems.  High energy prices and high housing prices only serve to keep their noses closer to the grindstone in order to make ends meet.  

Ironically, the harder they work, the easier it is for those with capital to earn a decent return.

Of course obtaining enough capital to achieve these goals in this overtaxed, over regulated, over extended society is a whole different problem!  

As Raisinbrain said, "They hate us for our freedom!"

 

[saluki9]

I just read some Wall Street Journal articles on Bush's budget proposal. He's talking about cutting entitlement programs that benefit the poor and elderly (that's cold, man) while raising the budget to fund the war.

Just remember, that they are "cutting" entitlements only in political terms. If last year they wanted to increase medicare spending by 10% and the president's budget ONLY increases it by 5% that is considered a drastic cut

still, I agree with your other concerns, but we have been through worse as a country

 

[getoutearly]

One thing is certain, Bush will not be president in a few years, so the extent of any damage he does will be limited. 

In the meantime, you need to donate half your salary (or more) to the charities of your choice to combat his budget proposal.  That's how you can help beat the doom and gloom.

LOL, hopefully that's not your politics showing....

 

[Delawaredave]

I recently read "The Coming Generational Storm" - really scary forecasts about the proportion of older/retired folks growing and their (our !) associated social security / retirement / medical balloning costs.

To meet these costs, the required tax increases on the smaller pool of workers is staggering. The impact of trade / debt inbalances might tank the dollar.

But maybe there's always "gloom and doom" on the horizon - World Wars, plagues, etc.

Have a great day !

 

[ladelfina]

Capital can leave a country if it gets taxed too much, so the government generally goes after capitalists last when looking for revenue. Workers generally cannot/will not leave the country..

davew, I had never explicitly thought of things this way, and I think you are dead on. But, that doesn't preclude a kind of social revolution. I haven't read the book Delawaredave mentioned above, but it doesn't take much to see that if we reach a point where the majority of Americans are older and in difficulty, they will demand change.

The US got through WWI, the depression, WWII, Korea, and Vietnam with the top marginal rates in the 60s, 70s, and even up to 90%, apparently. The current top rate is an aberration in modern history; I wouldn't say that there'd never be any appetite for reverting to a more 'progressive' situation, given the way we are running up debt.

 

[wallygator69]

Hi,

Interest link with doom and glom as related to babyboomers retiring.

http://thegreatbustahead.com/

Don't agree, disagree, can't know the future but interesting...

Wally

 

[anthony]

May I respectfully correct  - THE GREAT BUST AHEAD mentioned ( www.thegreatbustahead.com ) is NOT about Baby Boomers retiring. The book specifically emphasises this and that the coming massive 13 year economic depression, begining as early as 2010, is due to the catastrophic decline in the number of big-spending 45 to 54 year olds. Baby Boomers to be sure, but this is 11 to 20 years BEFORE they retire.
Baby Boomers retiring however does cause two other crises - the overload of the SS and Medicare systems, but sadly this will be preceeded by the 13 depression projected in The Great Bust Ahead. This of course makes these two crises much, much, much worse!! God help us all and our families. America has no idea what is coming down the pike at it.

 

[cute fuzzy bunny]

America has no idea what is coming down the pike at it.

I'm in good shape then. I moved across the country 13 years ago and the mass turnpike is now clear on the other side of the country. Whatever comes down the pike, I figure I have at least a couple of hours, maybe a day or two, before it gets all the way out here. More than enough time to run out and buy a lot of canned soup and batteries.

 

[TromboneAl]

Interest link with doom and gloom as related to baby boomers retiring.

http://thegreatbustahead.com/

Whoopee! That graph shows a spectacular bull market for the first seven years of my retirement!

Seriously, these doom and gloom things are so compelling! Imagine how much more compelling they are when the market is down 10 - 20%. It's no wonder that so many people bail out right at the bottom.

I hope I can resist. Tie me to the mast, boys!

 

[cute fuzzy bunny]

Now sit down and come up with the most optimistic scenario thats even somewhat plausible.

I suspect reality will be somewhere in the middle.

 

[mark]

Ahh. This thread is much to pessimistic.

No doubt hard times will come. As well as recovery and prosperity.

The stock market will go in an extended nosedive someday.....and then recover nicely, in some unknown and unpredictable timeframe. Recessions will occur and may be severe, but recovery will come and money will be made out of the wazoo by many.

Social Security and Medicare problems will be solved.

Seems the doom and gloomers are always over at 45, as they realize their own mortality.

The youth see opportunity and wealth.

I am 48.

 

[Martha]

Seems the doom and gloomers are always over at 45, as they realize their own mortality.

Except for Dave.

Troll.

Rare point of agreement, Dave.

Please note that the only posts Anthony has made relate to the website promoting the publication he refers to in his last post, except for one out of proportion attack on Brewer.

 

[cute fuzzy bunny]

Then I vote he's terminated with EXTREME prejudice

I know, its not a democracy...

 

[unclemick]

Heh heh heh - I'm 62 going on 63.

Don't forget sour grapes:

"God looks after drunkards, fools, and The United States of America."

Charles De Gaul

Whats French for curmudgeon?

 

[cute fuzzy bunny]

I dont know, but if you said it, someone would probably think you were choking and would give you the heimlich maneuver.

 

[Nords]

Troll.

Anthony, I'd classify your repetitive book posts as spam. Kindly move on to another topic before the moderators have to start fulfilling their job descriptions. If you don't have another topic then you're right, you do need another forum.

Dave, I think a better example of troll behavior is the repetitive railing against a specific demographic or other group. Whenever you're contemplating another "@#$*%ing Boomer" post, try this experiement-- substitute the words "Latino", "Republican", "Jew", or "woman" for "Boomer". If the tone of the post would offend any member of those four groups, then you're trolling.