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Is your 401K better off now than 4 years ago?

Old 09-05-2012, 02:29 PM
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Originally Posted by nat View Post
the exact same problems that caused the 2008 meltdown are still on the on the books of the major investment banks and also now the FED.

700 trillion in fraudulent derivataive contracts

The FASB allowed the investment banks to change their accounting methods after the meltdown. Thus they carry the financial garbage on their books at full value to maturity, when the actual value is nothing.

So, the can was kicked down the street a few more years while the banks financial statements are real life cartoons and the FED injects liquidity into the financial markets to goose the markets into gear.

we are due for another 2008 type event soon, probably in 2013 or 2014

so, enjoy the warm fuzzy feeling while it lasts
agree 100%
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Old 09-05-2012, 02:39 PM
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Originally Posted by nat View Post
the exact same problems that caused the 2008 meltdown are still on the on the books of the major investment banks and also now the FED.

700 trillion in fraudulent derivataive contracts

The FASB allowed the investment banks to change their accounting methods after the meltdown. Thus they carry the financial garbage on their books at full value to maturity, when the actual value is nothing.

So, the can was kicked down the street a few more years while the banks financial statements are real life cartoons and the FED injects liquidity into the financial markets to goose the markets into gear.

we are due for another 2008 type event soon, probably in 2013 or 2014

so, enjoy the warm fuzzy feeling while it lasts
Wait, loosening the criteria of FV in M2M accounting isn't good?

You nailed it.
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Old 09-05-2012, 03:10 PM
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wow 3 pages, look there are a lot of discussions spawning out of this thread, good ones too. Probably some for their own thread.
So lets get back to sprokets point, he pointed to the s&p being up and concludes all is well with the economy.
My disagreement is the s&p is up because the federal reserve has artificially support the s&p and dow through their actions of 2 QE's, ZIRP and whatever other program they have put out there.
I am saying that yes the s&p is up and has gone up a lot, and if you put money in when it was down and now took it out you would have made a profit. that point is true.
But to say everyone is better off because simply it is up, is not true. Because people not taking any money out of their 401ks have paper gains, but are suffering in other areas of the economy.
What areas, I am sure venture would be asking me, as I stated in a previous post.
Homes under water
Unemployment
Under employment
Real estate still down in most areas
Businesses getting hit with new healthcare tax
Banks not lending money fed put into system which hampers business growth
Businesses not hiring because they are not sure about future
16 trillion in debt that can't not be paid back
etc.
I am simply arguing the point that one indicator the s&p being up, is not conclusive, when you look at why it is up and what has and hasn't not happened.
Ok got to finish up my day playing business owner
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Old 09-05-2012, 04:08 PM
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Originally Posted by bellsisland View Post
wow 3 pages, look there are a lot of discussions spawning out of this thread, good ones too. Probably some for their own thread.
So lets get back to sprokets point, he pointed to the s&p being up and concludes all is well with the economy.
My disagreement is the s&p is up because the federal reserve has artificially support the s&p and dow through their actions of 2 QE's, ZIRP and whatever other program they have put out there.
I am saying that yes the s&p is up and has gone up a lot, and if you put money in when it was down and now took it out you would have made a profit. that point is true.
But to say everyone is better off because simply it is up, is not true. Because people not taking any money out of their 401ks have paper gains, but are suffering in other areas of the economy.
What areas, I am sure venture would be asking me, as I stated in a previous post.
Homes under water
Unemployment
Under employment
Real estate still down in most areas
Businesses getting hit with new healthcare tax
Banks not lending money fed put into system which hampers business growth
Businesses not hiring because they are not sure about future
16 trillion in debt that can't not be paid back
etc.
I am simply arguing the point that one indicator the s&p being up, is not conclusive, when you look at why it is up and what has and hasn't not happened.
Ok got to finish up my day playing business owner
I don't think he was saying that stocks being up was conclusive of anything. What he said was:

"Below is a chart of the S&P 500 covering the period 12/31/2008 through 8/31/2012. In no way am I suggesting the S&P 500 is the end all of stock indexes, but it does shed some light on how large companies have fared during the tenure of the current administration. For example, it does not take into account smaller companies or other foreign equity asset classes. With all the talk about the terrible economy, I can easily say that my retirement account is in much better shape than it was 4 years ago."

You raise some very valid points and concerns. My reason for chiming in was simply to agree that, while far from perfect, things are not as bad as some would want us to believe. This is not an "us versus them" party thing. Both parties do it. But enough repetition of loud negative noise and the negative inertia becomes very hard to overcome, regardless of who is "in charge". I'm not suggesting rose colored glasses or urging for pollyanna perspectives. Just a little bit of fairness and reality. It is indisputable that there is a lot more wealth in equities now than there was a few years ago. That wealth is largely liquid, and translates to much stronger buying power and economic solvency. Not perfect, or even nearly as good as it needs to be. But a good bit better than it was.
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Old 09-05-2012, 04:36 PM
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Originally Posted by PaulyBee View Post
well said, completely agree. just to add one comment, private equity is the true indicator of the economy and not public market. public market can and is manipulated and inflated so the big hedge funds with deep pockets make money on volatility on both sides of the trade. bottom line is private equity is the true indicator and it has been suffering for years and i dont see that changing anytime soon
I am told that when confidence in Treasury bonds finally breaks, and capital decides to move out of bonds, that stocks,real estate and gold will benefit

trust in government bonds would do an about face

because of the size of the bond market

when that money moves....something is gonna inflate



I also was told that recent court rulings on MF Global / Corzine give the investment banks and brokerage houses the green light to use your money.

then lose it......and leave you holding the bag

http://www.reuters.com/article/2012/...87900T20120810
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Old 09-05-2012, 05:04 PM
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Cajun,
You say things are not that bad, give us some examples? Tell us why you think that we are generally in a good spot as far as the economy goes?
What I want to know is what you think has changed? Meaning what problems have been resolved in the last couple of years, vs just being post poned until later?

Hey this is great and a good discussion without it becoming emotional.





Originally Posted by Cajun Martini View Post
I don't think he was saying that stocks being up was conclusive of anything. What he said was:

"Below is a chart of the S&P 500 covering the period 12/31/2008 through 8/31/2012. In no way am I suggesting the S&P 500 is the end all of stock indexes, but it does shed some light on how large companies have fared during the tenure of the current administration. For example, it does not take into account smaller companies or other foreign equity asset classes. With all the talk about the terrible economy, I can easily say that my retirement account is in much better shape than it was 4 years ago."

You raise some very valid points and concerns. My reason for chiming in was simply to agree that, while far from perfect, things are not as bad as some would want us to believe. This is not an "us versus them" party thing. Both parties do it. But enough repetition of loud negative noise and the negative inertia becomes very hard to overcome, regardless of who is "in charge". I'm not suggesting rose colored glasses or urging for pollyanna perspectives. Just a little bit of fairness and reality. It is indisputable that there is a lot more wealth in equities now than there was a few years ago. That wealth is largely liquid, and translates to much stronger buying power and economic solvency. Not perfect, or even nearly as good as it needs to be. But a good bit better than it was.
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Old 09-05-2012, 05:27 PM
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Originally Posted by bellsisland View Post
Cajun,
You say things are not that bad, give us some examples? Tell us why you think that we are generally in a good spot as far as the economy goes?
What I want to know is what you think has changed? Meaning what problems have been resolved in the last couple of years, vs just being post poned until later?

Hey this is great and a good discussion without it becoming emotional.
Bells- I agreed that the stock market is up dramatically, and I agreed that is a very positive economic step- much better than if the stock market had half of its current value. That's all I said, other than giving some recent historical perspective to the current economic concerns and fears. I am definitely not saying that everything is good and I'm not predicting that there is no cliff ahead of us. But it seems to me that there is "extra money" still in the system looking for a place to "live", or the stock market wouldn't be up like it is, and I believe that people in general- and the US in particular- want to be optimistic, and that is reflected in the stock market being up (versus all of the extra money being buried in the backyard or hidden under the mattress). My hope, and my reason for commenting, is that the next time things are truly going well with the economy, as they were not long ago and as I sincerely hope that they will again, that we (all of us) remember these fears and concerns that we have now and remain focused on completing "the repair" to our deficit, create long term energy independence and similar critical issues, rather than getting distracted- as we also have in the recent past. I am very concerned that all of the highly negative noise, from both parties, polarizes people, keeps everyone focused on the next election cycle and makes it very hard for us to see another side of anything. I
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Old 09-05-2012, 05:40 PM
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For the economy to grow and create value the consumer has to spend to grow the earnings of both public and private companies. This would create expansions, jobs and more growth. How can consumer (the middle class) spent when they are working to pay off debt that they build over the past decade in credit cards and through the collapse of the housing market? Middle class is poorer than ever and are having hard time to find good paying jobs to pay off the debt they are sitting on.
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Old 09-05-2012, 07:28 PM
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Originally Posted by Sprockets View Post
This may get pushed down to the bilge, but at the same time it may generate some intelligent discussion.

Below is a chart of the S&P 500 covering the period 12/31/2008 through 8/31/2012. In no way am I suggesting the S&P 500 is the end all of stock indexes, but it does shed some light on how large companies have fared during the tenure of the current administration. For example, it does not take into account smaller companies or other foreign equity asset classes.

With all the talk about the terrible economy, I can easily say that my retirement account is in much better shape than it was 4 years ago.

Discuss....
Comapanies are doing well because of the cost cutting that's taken place. Some of which has been delivered by efficiency. Some of it has been achieved by eliminating jobs. There are folks that have had to dip into their retirement nest egg to get them through rough times. I'm fortunate enough to have not lost my job, but I'm now doing the work of 3 people.
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Old 09-05-2012, 08:28 PM
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Cajun great point, and I want to point out that we are all just discussing what we think, and I think you have some great points. This is a great discussion that gets everyone thinking, and also gets everyone posting some great thoughts on what may happen. I look forward to all of us continuing this discussion as too what may happen, and also what we should be thinking about in order to figure out what maybe we should be doing to protect what we do going forward.

Originally Posted by Cajun Martini View Post
Bells- I agreed that the stock market is up dramatically, and I agreed that is a very positive economic step- much better than if the stock market had half of its current value. That's all I said, other than giving some recent historical perspective to the current economic concerns and fears. I am definitely not saying that everything is good and I'm not predicting that there is no cliff ahead of us. But it seems to me that there is "extra money" still in the system looking for a place to "live", or the stock market wouldn't be up like it is, and I believe that people in general- and the US in particular- want to be optimistic, and that is reflected in the stock market being up (versus all of the extra money being buried in the backyard or hidden under the mattress). My hope, and my reason for commenting, is that the next time things are truly going well with the economy, as they were not long ago and as I sincerely hope that they will again, that we (all of us) remember these fears and concerns that we have now and remain focused on completing "the repair" to our deficit, create long term energy independence and similar critical issues, rather than getting distracted- as we also have in the recent past. I am very concerned that all of the highly negative noise, from both parties, polarizes people, keeps everyone focused on the next election cycle and makes it very hard for us to see another side of anything. I
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Old 09-06-2012, 07:04 AM
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Wow look at the market go, why? The ECB just said it was going to start a open ended bond buying program. What does that mean, they are buying spanish and italian debt.
Handing out candy makes the kids very happy
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Old 09-06-2012, 07:06 AM
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Originally Posted by bellsisland View Post
Wow look at the market go, why? The ECB just said it was going to start a open ended bond buying program. What does that mean, they are buying spanish and italian debt.
Handing out candy makes the kids very happy
It also causes cavities.


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Old 09-06-2012, 07:52 AM
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Originally Posted by Brad1 View Post
...I'm fortunate enough to have not lost my job, but I'm now doing the work of 3 people.
Now bend over and smile.
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Old 09-06-2012, 09:31 AM
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Can say that it looks better, just about every day. I was lucky to be able to sideline my 401k when it hit 6900 and probably lost a lot by not just diving back in then. Thankfully the roller coaster rides attributed to machine trading and flash crashing, seen in 2010 and 2011, have subsided somewhat.

Returns now are smaller than earlier in the decade. I now have come to realize that those early decade returns were based on a phony, unsustainable economy. Even though the returns were mindblowing, I definitely do not want to revisit the "good old days"
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Old 09-06-2012, 10:56 AM
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Sure Wall St and the banks are better off. They've gotten help with every aspect of their business, using tax payer dollars to do it. Meanwhile, main st, where I reside, keeps taking it up the ass. Gas is higher, my electric bill is higher, my grocery bill has skyrocketed, my phone and cable have skyrocketed, my liability, workmans comp, and auto insurance has gone thru the roof as has my health insurance. My house is worth pennies on the dollar, as is my equipment and vehicles. My personal property and real estate tax's have been raised. I've laid off people every year for the last 4 yrs. Yep, America is in great shape. Another 4 yrs with our fearless leader, the recession will be a distant memory and we will be kings of the universe. Dont forget to add in the real unemployment rate of about 18% of the entire country, a record number of people on food stamps and other government handouts.

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Old 09-06-2012, 03:12 PM
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Hey guys. I've been on the road all day and just caught up on the thread.

The main reason for posting is that I was getting tired of hearing the line, "Are you better off now than 4 years ago". My thinking is that most, but certainly not all of us are better off. I am certainly in better shape financially than I was 4 years ago.

The debt is a major issue, and it will probably take decades to get out of this hole. This doesn't mean it won't happen, but it is going to take a long time.

I simply chose the S&P 500 because it was easy and at least it represents a cross section of large companies.
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Old 09-06-2012, 03:43 PM
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Originally Posted by Sprockets View Post
Hey guys. I've been on the road all day and just caught up on the thread.

The main reason for posting is that I was getting tired of hearing the line, "Are you better off now than 4 years ago". My thinking is that most, but certainly not all of us are better off. I am certainly in better shape financially than I was 4 years ago.

The debt is a major issue, and it will probably take decades to get out of this hole. This doesn't mean it won't happen, but it is going to take a long time.

I simply chose the S&P 500 because it was easy and at least it represents a cross section of large companies.
While my investments are higher, my buying power has been diminished. Property taxes are higher, salary stayed about flat, fuel is through the roof, food is up, the appliances I am buying for a remodel are up at least 30%, etc.. Wifes bonuses are down substantially (pharmaceuticals), margin on our firms services are down due to heavy competative pressure as there is less work overall and on and on.
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Old 09-06-2012, 06:02 PM
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Yep, I'm way up from 4 years ago, and not only because of Apple, all my other investments are up and today Thursday, they went "WAY" up.

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Old 09-08-2012, 06:19 AM
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Even a dead cat will bounce if you drop it hard enough. My investments, (tech) have been dead flat the last 12 years. The retail may be doing ok with unemployment checks, but "entitlements" rarely invest in infrastructure. And bottom line that is what will recover the economy.

If you want people to have jobs, (other than Gov't) make work jobs. You need to limit imports, or at least level the playing field. Taxing domestic production, while letting foreign goods come in tax free is the sure recipe to eliminate jobs, and factories.

At least making the tarrifs equal to income, and inventory tax would level the playing field.
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Old 09-08-2012, 09:12 AM
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I know comedians will say they are not better off than 4 years ago.
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