Scathing New Report Shows Just How Bankrupt Social Security Really Is

Instead of participating, we invite you to work really hard, and pay lots in taxes to bail the system out!

Very Truly Yours, 

Boomers.​
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​More below.

Investors Check Out of Europe

This is the blue model in action.

30-year S&P 500 returns are pretty impressive

Because the cumulative rates of return are fantastic. 

Why would you not wish to participate in this? Small amounts invested early in life, and husbanded over long periods of time result in a large investment. Forget getting rich quick, get rich slow, it actually works.

Money advice in funny, and easy to follow cartoons.

Why Don't Progressives Use Their Power as Hedge Fund Customers to Challenge Hedge Fund Compensation? | Coyote Blog

Progressives, and progressive institutions invest in these things, which makes sense. 

​Read more below the fold!

Buffett's Other Big Investment Secret

​. . . unless you want to speculate, and then you should not listen to an advisor.

Read more below!

Olivier Blanchard eyes ugly 'end game' for Japan on debt spiral

. . . how the hell does a country decide to allow the debt level to reach 250% of GDP?

"Japan is heading for a full-blown solvency crisis as the country runs out of local investors and may ultimately be forced to inflate away its debt in a desperate end-game, one of the world’s most influential economists has warned.

Olivier Blanchard, former chief economist at the International Monetary Fund, said zero interest rates have disguised the underlying danger posed by Japan’s public debt, likely to reach 250pc of GDP this year and spiraling upwards on an unsustainable trajectory."

I can still remember back in the 1980s when Japan was going to take over the world, and the value of land in Tokyo was higher than all the land in the US. Needless to say, that little bubble popped. Soon after, Japan slid into its old age, with its economy barely able to get up to use the toilet. 

The article starts out focused and worried about Japan, but quickly turns its attention to Europe, as it should. 

I keep asking myself, who would lend money to the Japanese? Only younger Japanese. Demographically, Japan is dying. There are too many old, too few young, and the workforce is contracting. They will need to achieve near perfect robotization to fill their factory floors, take care of the old, keep the water, and sewers running, and babysit the vanishingly few children. How long before all that is left is an island of robots? Well, we know when Japan has reached that point when the robots are making 2nd generation sex robots to satisfy the 1st generation sex robots. 

Europe is hot on Japan's heels with bad demographics, an impossibly weak economy, and a large number of nations which appear to be in permanent economic depression. 

The solution to these problems is not particularly difficult, but requires tax reform, work rule reforms, wage reforms, union reforms, political reforms, welfare reforms and there is less than zero interest in any of this. The Germanic north, and Scandinavia seem to be willing to make serious reforms, and when implemented, the reforms, work well. They might be slow in implementing these changes, but they happen. The south is unwilling to even contemplate real change.

Eventually the article glances off the whole Brexit problem, but answers no questions. Britain is faced with this question, should it stay in the Eurozone, build its relations there becoming a full member? Or should Britain leave the Eurozone and build relations elsewhere? 

The above analysis seems compelling. Europe is mostly a disaster sliding into economic catastrophe. Why would Britain agree to that? Belgium, France, Portugal, Spain, Italy, Greece, and more are in dire shape, with debt averaging well above 100% of GDP. All claim to be following the rules, but still debt seems to increase endlessly. These countries are in what amounts to a permanent depression. Exactly what does Britain stand to gain from these relationships? Debt? Obligations? 

Perhaps it is time to look elsewhere. Perhaps the NAFTA could provide some direction. Britain could turn away from Europe, and turn to its former colonies, like Canada, and even America. It could form, or join existing trade agreements between these nations. The nations involved in NAFTA have far more economic potential than do the European countries. These are mostly active and healthy economies. 

It will be interesting to see what Britain does. I await the referendum. 

Kyle Bass Blog

7 hard truths about money, in cartoons that will make you smile

My advice isn't funny, but it is solid. 

1. It is easiest to have money withheld from you paycheck. You will never notice it. If you cannot do that, put it away, into an IRA before you do anything else with your money. 

2. Tax favored accounts like IRA's, and 401K's are brilliant since they allow you to build wealth without Uncle Sam taking a bite each year. Roth IRA's are better because the money is not taxed when you take it out in retirement.

3. Invest primarily in index mutual funds or the equivalent. These have low fees, and commonly do better than funds attempting to meet their performance. Plus, they really are invest and forget investments.

4. Start young. 

5. If you have an investment horizon of longer than 10 to 15 years, keep you money in the stock market. 

6. Even if you receive a windfall, say an IRA inherited from a grandparent, you should maintain discipline, and make your IRA contribution each and every year. 

For parents and grandparents: Help you children invest in IRA's once they begin earning money. I offered my son a 100% match if he would stash a significant amount of money in a bank account for a "rainy day." At 21 he now has a retirement savings of just about one half of that of the average Boomer, he also received a large windfall of retirement income when his grandfather died. 

Baby Boomers Face a Shocking Retirement Savings Shortfall

GDPNow Forecast Sinks to 0.4% Following More Weak Economic Report | MishTalk

. . . damn ugly! 

I admit to being still a bit high centered by the data, which is hard to fathom currently. I have little faith in the Fed, or the Blue Chip Economic forecasts. They tend to be more wrong than right. I also have found both Mish, and MaxedOutMama to be reasonable forecasters. 

But, I am pretty conservative when it comes to economic forecasts. So, I am still on the fence. I suspect that we have perhaps a 40-45% chance of an actual recession. I do not think Stockman is correct with his wild eyed apocalyptic forecast but who knows. 

I also think while stock prices are absurdly high, the flight to security from a recessionary world will cause inflows to the US of substantial monies looking to buy assets. Let's be honest, debt is not very attractive right now, and assets like corporate stock, and other real assets are likely to attract significant interest. 

Then again, I am a long term player, I buy and hold mostly index funds.

​Good luck out there!

Robots are better investors than people - FT.com

. . . waiting to trap the unwary.

These robots simply act on well established maxims of investing. They will do better than the individual trying to pick individual stocks, they will do better than the average professional, even better than the big time pros, and hedge fund managers. But they will only do so until most people begin using robots to invest. What is going on is the robot play the market as the "house." In this role, everyone else takes the flyers, risking money willy nilly. Once these flyers are gone, returns will level out. 

Forget what I just said, you really need to develop your own investment strategy, and buy your own stocks, I need about 40 more years of solid return from other people making flyer investments to make retirement work! Get cracking!