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  1. #151
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    http://www.slate.com/blogs/moneybox/...e_mistake.html

    What went wrong? The 401(k) began as a technical adjustment to the tax code, one meant to mostly impact high-earning executives using profit-sharing plans. People like Benna, a benefits consultant, convinced the Reagan administration that the language of the statute allowed for all employees to put aside a portion of their salaries on a tax-deferred basis. It was supposed to supplement corporate pensions. Instead, in something almost no one foresaw, the 401(k) replaced them.
    No shit Sherlock.

    Herbert Whitehouse, a former Johnson & Johnson human resources executive who pushed the then-new savings vehicle in the early 1980s, now says even he can’t retire until his mid-70s if he wishes to maintain his standard of living, because, Martin writes, his 401(k) “took a hit” in 2008. He’s 65.

  2. #152
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    ^ They're on On Point right now.

  3. #153
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    Oh, for fucks sake.

    "Herbert Whitehouse, a former Johnson & Johnson human resources executive who pushed the then-new savings vehicle in the early 1980s, now says even he can’t retire until his mid-70s if he wishes to maintain his standard of living, because, Martin writes, his 401(k) “took a hit” in 2008. He’s 65"

    That's a story of someone who managed his finances in a very very bad way. He was a higher executive in a very old school eastern corporation for all those years, and can't retire at 65? What the fuck. He has to have a decent pension, grandfathered to old standards. He didn't save anything else? He had a fucking 401k, duh. How many divorces? Hookers and blow? Jezuz. More proof Human Resources is filled with idiots.

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  4. #154
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    The key phrase is "if he wishes to maintain his standard of living." The guy couldprobably retire today and live a lifestyle most of us would be more than happy with, but he wants to keep living like a 0.1%'er.

  5. #155
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    So he cashed out in the great recession after taking a 50% haircut. Fool and his money...
    Success has many fathers, while failure remains an orphan // Many men go fishing all of their lives without knowing that it is not the fish they are after - HDT

  6. #156
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    Quote Originally Posted by Benny Profane View Post
    Oh, for fucks sake.

    "Herbert Whitehouse, a former Johnson & Johnson human resources executive who pushed the then-new savings vehicle in the early 1980s, now says even he can’t retire until his mid-70s if he wishes to maintain his standard of living, because, Martin writes, his 401(k) “took a hit” in 2008. He’s 65"

    That's a story of someone who managed his finances in a very very bad way. He was a higher executive in a very old school eastern corporation for all those years, and can't retire at 65? What the fuck. He has to have a decent pension, grandfathered to old standards. He didn't save anything else? He had a fucking 401k, duh. How many divorces? Hookers and blow? Jezuz. More proof Human Resources is filled with idiots.
    Quote Originally Posted by Bromontana View Post
    So he cashed out in the great recession after taking a 50% haircut. Fool and his money...
    Yeah I'm with you two here. Holding this guy up as some example is absurd.

    I'm no trumptard, and haven't been following this thread closely, but this thread title seems pretty off point these days, no?
    I still call it The Jake.

  7. #157
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    Quote Originally Posted by Bromontana View Post
    So he cashed out in the great recession after taking a 50% haircut. Fool and his money...
    No, but betcha he cashed out on his overpriced MacMansion before it crashed, and he's still looking at another twenty or so years on that loan which may very well be underwater with transfer costs. He probably never saved enough to "cash out" of his 401k, although he sure enough borrowed on it, I'll bet, and the first wife laid claim to half his pension in the divorce settlement. Then there's the very large debt he co signed to get the kids worthless graduate degrees.

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  8. #158
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    Fk I live a simple life. That shit sounds miserable.

    By c/o I meant exit equities, not the 401k.
    Success has many fathers, while failure remains an orphan // Many men go fishing all of their lives without knowing that it is not the fish they are after - HDT

  9. #159
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    Quote Originally Posted by BmillsSkier View Post
    Yeah I'm with you two here. Holding this guy up as some example is absurd.

    I'm no trumptard, and haven't been following this thread closely, but this thread title seems pretty off point these days, no?
    Not really. Dude isn't in office yet and has zero economists on his policy team. The odds that a recession occurs and is handled badly are pretty high. Plus you've got a raft of crazy-pants legislation that may come out of Congress.

    And I'm not a believer in market timing, either. But if I were one of you old guys, I would consider taking a more conservative portfolio position or diversifying internationally.

    Lots of downside risk to consider from the fucked-up incoming government.

  10. #160
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    Quote Originally Posted by Sirshredalot View Post
    Not really. Dude isn't in office yet and has zero economists on his policy team. The odds that a recession occurs and is handled badly are pretty high. Plus you've got a raft of crazy-pants legislation that may come out of Congress.

    And I'm not a believer in market timing, either. But if I were one of you old guys, I would consider taking a more conservative portfolio position or diversifying internationally.

    Lots of downside risk to consider from the fucked-up incoming government.
    If another recession comes, and it will, Trump and the Congress' response will be austerity--the same policy that fucked and continues to fuck most of Europe. The only "stimulus" will be another tax cut for the wealthy, which they'll salt away and do nothing for the economy.

  11. #161
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    Quote Originally Posted by BmillsSkier View Post
    . . . this thread title seems pretty off point these days, no?
    TBD. Equity markets are up because Trump's promises -- i.e., huge tax cuts for the rich, huge infrastructure jobs bill, promises that trickle down redux will result in 4%+ growth, possible triggering of trade war, blowing up ACA -- are inflationary. What the GOP-controlled Congress will actually do is another matter because there will be Trump enabler vs. deficit hawk infighting.

    Quote Originally Posted by Sirshredalot View Post
    Not really. Dude isn't in office yet and has zero economists on his policy team. The odds that a recession occurs and is handled badly are pretty high.
    Quote Originally Posted by old goat View Post
    If another recession comes, and it will, Trump and the Congress' response will be austerity--the same policy that fucked and continues to fuck most of Europe. The only "stimulus" will be another tax cut for the wealthy, which they'll salt away and do nothing for the economy.
    Agree on all points.

    At my stage in life and financial position, my question is whether the inflationary pressures of early Trump term will manifest in the availability of super safe debt investments @ 4%+. If so, well-timed purchase of such debt followed by recession could work out for the lucky few with the cash to buy said debt. Working stiffs will get fucked over, of course.
    Last edited by DIYSteve; 01-04-2017 at 06:35 PM.

  12. #162
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    Quote Originally Posted by Sirshredalot View Post
    Not really. Dude isn't in office yet and has zero economists on his policy team. The odds that a recession occurs and is handled badly are pretty high. Plus you've got a raft of crazy-pants legislation that may come out of Congress.

    And I'm not a believer in market timing, either. But if I were one of you old guys, I would consider taking a more conservative portfolio position or diversifying internationally.

    Lots of downside risk to consider from the fucked-up incoming government.
    That's one view. But of course that's a lot of assumptions.

    The other view is, markets are forward looking.

    I think the guy is bat shit crazy but Ford said just yesterday that they see a more "business friendly future". See the Jalopnik article today, too lazy to cut and paste on the phone.

    My money says the sky isn't falling and cooler heads prevail. Everyone wants to make more money.
    I still call it The Jake.

  13. #163
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    Quote Originally Posted by BmillsSkier View Post
    My money says the sky isn't falling and cooler heads prevail. Everyone wants to make more money.
    Will Trump back down on his promises to impose stiff tariffs? Or will Congress thwart that plan? If neither -- and Trump acts on his promise to start antagonizing trading partners -- a trade war would certainly trigger a recession, no? And there's cause to believe that China might see a Trump-triggered trade war as a long-term opportunity for China to replace USA as global leader. I suppose the rosy view is that Trump's tough talk about trade is nothing more than empty bluster.

  14. #164
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    Trump and your 401k: what to sell and when?

    If you think Europe is in a mess because of austerity you're on crack.

    Quote Originally Posted by BmillsSkier View Post
    I think the guy is bat shit crazy but Ford said just yesterday that they see a more "business friendly future". See the Jalopnik article today, too lazy to cut and paste on the phone.

    My money says the sky isn't falling and cooler heads prevail. Everyone wants to make more money.
    I agree. 'Trade war' is a gross overestimation of what would actually happen.

    On the other hand...was(sorry...is) the ACA good for businesses? Was a rather high corporate tax rate good or bad? Minimum wage- good or bad? Overboard on SOME of the regulation in financials...good or bad? Regulation in health care/drug pricing?

    Aside from how it impacts us socially...trump is generally good for most business. Though maybe too good if inflation starts to take off
    Decisions Decisions

  15. #165
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    Quote Originally Posted by Brock Landers View Post

    Aside from how it impacts us socially...trump is generally good for most business. Though maybe too good if inflation starts to take off
    I suppose. Unless he does or says something that undermines treasury.

    Inflation is wishful thinking. So is anything North of 3% GDP. There is way too much supply of global labor to have any long term inflation.

  16. #166
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    Quote Originally Posted by 4matic View Post
    Inflation is wishful thinking. So is anything North of 3% GDP. There is way too much supply of global labor to have any long term inflation.
    But Trump's biggest campaign promise was to place barriers on imports made by cheap foreign labor -- and that's why he took the Rust Belt and won the EC. Sure, I don't think he'll make good on his promise of an across-the-board 35% tariff on Chinese goods because he'll need a complicit Congress to do that, but he'll throw some wrenches into global trade as we know it because he's gotta serve some raw meat to his Rust Belt supporters. If he starts the taunting, he can't control the response. And China has long-term geopolitical reasons to make an outsized response.

    If I had to bet, I'd bet on some inflationary pressure the first year of his term, followed by a recession with some sectors deflating. But that's pure speculation of course because the reality is that none of know what the fuck is gonna happen. Trump is the biggest wild card in our lifetimes.

    ETA: I'm not the only guy seeing the risk of some level of trade war: See, e.g., today's Vox article, Donald Trump sure seems like he’s serious about starting some trade wars

    ETA2: Notes from The Fed's December meeting published today, hinted at risk of inflation and accelerated push up of prime rate as a response.
    Last edited by DIYSteve; 01-04-2017 at 09:10 PM.

  17. #167
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    We are in a recession. It may have ended for some, but Trump got elected because many of his voters have been knee deep in recession/depression for twenty to thirty years. And it isn't going to get better. I'll bet most corporations are accelerating the adoption of new tech to eliminate labor and costs, but in a more stealth mode.

    It's simple. The rich are going to be richer with more tax cuts and repatriation of foreign cash. That money has to go somewhere, and that's US equities, the best place to make money these days. Sure, its smart to play it safe in bonds, but, everybody likes to make a little money, and there will be a lot of money seeking returns. I'm not saying that it's going to be smooth, but, anybody with money will do ok.
    Too much labor oversupply for inflation.

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  18. #168
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    Quote Originally Posted by Benny Profane View Post
    We are in a recession.
    Under your personal definition, maybe, but not per traditional definitions. Economic activity is increasing. GDP is growing. So, no, we're not in a recession as traditionally defined. I don't dispute the problem of growing wealth inequality and that as a result much, maybe most, of America is struggling, but that's a different issue.

    In its notes of the December meeting The Fed noted tightening domestic employment rate as portending inflation. Cueing Bunny to say it's a horseshit number and The Fed doesn't know shit.

  19. #169
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    Ok, bait taken. The Fed lives in a bubble, created by numbers and ideology. Yeah, unemployment is down, but most jobs created since 08 are crap, and wages really aren't rising. Add to that 10,000 boomers a day turning 65, most with no savings and a lot of debt, in fear daily for their jobs, if they have one, and the young ones entering life with an average of 30,000 in student debt, many in six figures, and they ain't getting jobs to pay for that debt. The rest of the country is up to its noses in debt, both public and private. Betcha Chicago follows Detroit soon. You tell me where the inflation will come from, especially as China just can't stop making cheap steel and shit, just to keep their people from revolting.
    Last edited by Benny Profane; 01-05-2017 at 06:06 PM.

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  20. #170
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    Quote Originally Posted by DIYSteve View Post
    Will Trump back down on his promises to impose stiff tariffs? Or will Congress thwart that plan?
    What plan? All I know of is sound bytes & tweets. The trade war will be deployed on the fourth day of the presidency, right after he builds the wall on day 1, deports millions on day 2 & drains the swamp on day 3.

  21. #171
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    Trump and your 401k: what to sell and when?

    Benny wages have been rising fairly sharply for 5 months. And GDP growing- albeit slowly- for 7+ years. "Yeah unemployment is down"...we are at nearly full employment. Most jobs created since 2009 are crap? Like what?

    Inflation (which was already accelerating since July) can additionally come from a few areas:
    Tax cuts: This is easy. More dollars to spend is sharply inflationary.
    Infrastructure projects: More jobs, more money in the system vying for resources, and more competition explicitly from those projects for capital resources (steel, equipment, etc).
    Immigration: even if it's a minimal change...not letting the current number of potential workers into the country cuts the supply of workers. Wages go up to fight for what workers are left. Especially at the top end, where even a small reduction in work visas for highly skilled workers (which I think is a huge mistake) would be very inflationary.
    Trade: I'm not a big trade war guy. Not happening. But most countries globally are moving toward the protectionist/away from globalization view. Had been before the election. Regardless...tariffs are explicitly inflationary. Higher prices. Either passed on by customers or eaten by firms, hurting profits. This is actually one larger threat to certain industries and companies.
    Oil: it's just a headline factor, not part of CPI, but it does make an impact and it has come back.

    So, inflation was already accelerating off a very low base (break even levels the 2H of the year rose sharply); The Atlanta Fed reports on wage inflation show it pretty clearly growing. We are at full employment. These factors set the stage for even greater increasing inflation when/if even half or a quarter of the fiscal policy works out.

    Fed came out today and said they'd likely have to hike more this year. Which is fine. If they can get ahead of the curve and temper inflationary tailwinds we could prevent business expansion from running too hot. Which could potentially lead to a recession down the road (2H 2018?). But no recession now.
    Decisions Decisions

  22. #172
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    Quote Originally Posted by Brock Landers View Post
    Benny wages have been rising fairly sharply for 5 months. And GDP growing- albeit slowly- for 7+ years. "Yeah unemployment is down"...we are at nearly full employment. Most jobs created since 2009 are crap? Like what?

    Inflation (which was already accelerating since July) can additionally come from a few areas:
    Tax cuts: This is easy. More dollars to spend is sharply inflationary.
    Infrastructure projects: More jobs, more money in the system vying for resources, and more competition explicitly from those projects for capital resources (steel, equipment, etc).
    Immigration: even if it's a minimal change...not letting the current number of potential workers into the country cuts the supply of workers. Wages go up to fight for what workers are left. Especially at the top end, where even a small reduction in work visas for highly skilled workers (which I think is a huge mistake) would be very inflationary.
    Trade: I'm not a big trade war guy. Not happening. But most countries globally are moving toward the protectionist/away from globalization view. Had been before the election. Regardless...tariffs are explicitly inflationary. Higher prices. Either passed on by customers or eaten by firms, hurting profits. This is actually one larger threat to certain industries and companies.
    Oil: it's just a headline factor, not part of CPI, but it does make an impact and it has come back.

    So, inflation was already accelerating off a very low base (break even levels the 2H of the year rose sharply); The Atlanta Fed reports on wage inflation show it pretty clearly growing. We are at full employment. These factors set the stage for even greater increasing inflation when/if even half or a quarter of the fiscal policy works out.

    Fed came out today and said they'd likely have to hike more this year. Which is fine. If they can get ahead of the curve and temper inflationary tailwinds we could prevent business expansion from running too hot. Which could potentially lead to a recession down the road (2H 2018?). But no recession now.
    You're wrong about infrastructure. No direct increase in infrastructure spending is going to happen. Just tax breaks for time warner, oil companies, and utilities. No increase in g. And we won't see better than 2% growth domestically. There is no fucking way we're seeing 4%. And this Congress is going to go Full Retard on some bill. Though it is tough to guess which. Will it be a sovereign default on Treasuries? I fucking hope not, but they are that fucking stupid. We will find out!

    BTW, if Ford is going to kick ass over the next few years, I can afford to take tomorrow off and schralp pow. I'm not.

  23. #173
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    Speaking strictly to Ford, I'd take their massive resources and economic presence as a better indicator than a bunch of snow sports enthusiasts on a web forum's prognostications, they got through the recession/bailout better than any of their peers. But that's just me. Respectfully of course.

    I think the problem these days is the casual observer/investor/person isn't able to separate the politics of red vs blue and the market. For example: I know plenty of Blame Obama people that derided the printing press of money over the past 8 years but didn't think twice about bragging how their portfolio is well above pre-crash levels. Same can be said now. Look at the thread title, likely written not long after the electoral college was called that night. Futures were down what, 300-700 points? Now where are we? Like I said cooler heads prevail. We'll be fine if Scooby Doo is in the White House - our 3 branches are either bought and paid for by money making, market driving machines or they're incompetent fools, they can't be both simultaneously.

    Then again, it's not snowing where I am so I'm not facing with the same predicament.

    I'd go skiing.
    I still call it The Jake.

  24. #174
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    Quote Originally Posted by BmillsSkier View Post
    I think the problem these days is the casual observer/investor/person isn't able to separate the politics of red vs blue and the market. For example: I know plenty of Blame Obama people that derided the printing press of money over the past 8 years but didn't think twice about bragging how their portfolio is well above pre-crash levels. Same can be said now. Look at the thread title, likely written not long after the electoral college was called that night. Futures were down what, 300-700 points? Now where are we? Like I said cooler heads prevail. We'll be fine if Scooby Doo is in the White House - our 3 branches are either bought and paid for by money making, market driving machines or they're incompetent fools, they can't be both simultaneously.
    Lot of this going on with political emotion bleeding into financial jabber. Futures across Dow / S&P / Russell / Nasdaq were either at overnight lock-limit down or within a few pips (-5% or -$5,000 per DJIA futures contract, for ex.), I didn't even watch tv that night just had my jaw affixed to the floor, watching wealth evaporate & Trump rack up states. As certainty of Trump's win went over about the 85-90% mark, they stabilized & slowly reclaimed those losses by noon. Took me about 2-3 weeks to digest it. The past 18 months has been so miserable with the election I'm just not willing to lose any more energy on sky-falling propaganda (or the inverse). Last point is spot on.

  25. #175
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    Trump and your 401k: what to sell and when?

    Infrastructure spending has little long term economic impact unless it improves productivity. Do Chinese ghost cities promote real productivity? Nope.

    With regard to inflation. Money supply means nothing. Monetarist theory is false. Velocity of money is very slow m, at historic lows. You can print all the money you want but without velocity it will not create additional demand. The only scarcity that I see is in skilled labor and there could be significant inflation in those wages but the internet and technology will continue to be a deflationary force for years. Thats why the fed talks about investment in training and education as a long term solution

    There will be 100k brick and mortar retail layoffs this year. Where are those jobs going to go? Deflation is still the risk despite Fed cheerleading.
    Last edited by 4matic; 01-05-2017 at 01:14 AM.

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