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Nearly all of it is IOU's. Throughout the years, government departments have over-shot their budgets & could not look to the already exhausted "general fund" for the money. They borrowed it from SS, placed an interest rate on the IOU, and then were able to balance their department.
The departments re-pay Social Security; sometimes interest only... sometimes rolling all into a new loan w/new interest.
The bottom line: I have worked all my life & I was given the promise that, if I paid in the SS money with every paycheck, that the retirement benefits would exist when I retired. They did not say that they would attempt to write me checks based on IOU's held... they are supposed to write me checks based on the cash held. I put the cash there... my employer matched my cash... and when I get paid at retirement, I do not want a check drawn on the bank of trampoline.
Also, Social Security is now deemed a "pay as you go" system (meaning that revenues are equal to expenditures). I cringe when I hear "pay as you go..." because it's as if the American public is BUYING the new rhetoric, the new "IN" phrase. SS was never designed to be a pay-as-you-go system... it is not DEFINED as a pay-as-you-go system... it is a TRUST which, in all manner of all previous legislation, is supposed to earn 3% per year & grow sufficiently to fund the promises made to the participants.
You might do well to visit the site below. These are hard working, highly recognized, professionals who are desparately trying to focus our attention to a problem which grows daily. This organization has addressed congressional committee's several times. Their work is valuable for our country. [I have no affiliation with this site but have followed their efforts for several years.]
http://www.concordcoalition.org/issues/socsec/
Actually, Richard, you don't really need to do anything for six months.
If you had put the money in an interst bearing account, you wouldn't have yielded possibly 4% for a whole year! Since you gained 3.2%, you are at least 11/12ths of what you'd get in a year. You could sit around twiddling your thumbs if you wanted to!! (Not that you would, but I'm just saying that you should be pleased, rather than harsh, on the accomplishment).
There have been times that when I made 5% on something, I smacked my hands together & said "now I can rest for a year". That seems to calm me... not make me tooooooo critical. Also, the calm helps me into a (wouldn't you know it) soon-to-be new trade. I never wait it out.... I always put it back to work before times up.
Eric:
I let go of GG @ 27.90, saw it moving higher, then posted. I really was upset cuz it moved to 27.99 & I thought I may have made a mistake. I was very fortunate with that stock pick.
That was a phenomenal move in GG that day. It has since retreated a little chunk. But, I'm not sure that metals aren't topping... at least for now... what do you think? Are you as confused as I am???
And, do you know about Everbank? What do you think about a World Currency CD? If you could hit the "World Currency CD" tab on the link below, I'd like hear what you might think. Have you ever done a CD like this?
http://www.everbank.com/main.asp?affid=eb
Hi! Just spent a day reading more than my fair share !
I started out by looking for Court to make s-u-r-e that he caught Mauldin's letter today. Mauldin is sooooo on target... sounds & reads like a mix of all of us! You all just have to read it, okay????
Grab some coffee, hit this link, get the PDF & print it. I just love intellectual challenges!!!
http://www.frontlinethoughts.com/
Gotta go! Snow is building & the drive home will be treacherous. I have to work tomorrow... hope to check in then.
Scrap prices? You would die! I've been here 22 years... never seen prices like this...
Asian buyers are everywhere. China is building the equivalent of ONE "Dallas, Tx" every 30 days. The migration from the farm to industrialized areas/cities is enormous... the infrastructures demand steel, copper, aluminum... the whole gammit. At one point last year, cement in the States was short & guess why????!! The Chinese were gobbling up all the cement!
This simply is not sustainable... I realize that it can go on for quite some time... but the raw material costs ripple through every economy on the planet.
I KNOW stainless prices have got to be killing you. Your industry has got to be shakin' from the pressure!
Volume here is unbelievable. Simply unbelievable!
You might want to read the Financial Statements of the United States of America 2004. It is lengthy, but focus on the auditor notes.
Regardless of political party, & it appears that fingerpointing will not erase the checks being cut every day, laws need to be addressed immediately regarding the newly (2004) enacted prescription benefits. When Congress enacts a new law (ie Prescriptions for SS beneficiaries) & creates an "initial funding kitty" that is supposed to last 10 years... and it barely lasts the first year... then someone needs to throw up a red flag & either admit that Congress may have goofed, or ---> that the folks who provide them with 'estimated cost' & "projected costs" (upon which they make their decisions) should be replaced. Then, they need to address the mistake quickly.
It is not a "party" that will pay the price, it is a 'people'. As far as I'm concerned, our Congressmen have a DUTY to read the Financial Statements of the United States. They have a DUTY to address the myriad of references they would have read in those financial statements about the gigantic impact on the the budget caused by the enactment of the prescripion drug law in the manner in which they enacted it.
For what it's worth, they need to visit their mistakes & correct them. That doesn't mean elimination of the benefit, it means that they need to revalue the costs... revalue what benefit levels can be supported... revalue the growing impact of the law if left unchanged.
Actually,
I'm a long time acquaintance of n4907g & wondered what he was up to. I found this thread trying to catch up with him.. then got a tad hooked!
Do I have an experience with a retirement fund? Only on the administration level (profit sharing/401K/defined benefit). Do I know about government Social Security retirement? You bet.
Do I have an opinion about each? You bet!! And, if you understand all the number games, it boils down to : take care of yourself because all the promises given you might actually implode in your lifetime. And, if they do, you must rely on whatever you have personnally built.
Gotta go... & thanks for the greeting!
Social Security IS a trust. It is a legally described "separate entity" from the government. It is a "trust fund" which holds "funds in trust" for the benefit of the future of the participants in the trust. Any company, or even the employees of the company, who do not remit the "trust funds" withheld from employees paychecks are subject to imprisonment & personal or corporate asset confiscation.
It is THAT serious. If an employer withholds, he better pay. And... he better pay his matching portion as well.
Now then... something wicked happened at the government level. They didn't bother to 're-define' the SS trust, but they noticed that the Trust funds were gettin' enormous and all that money just sat around "growing". Hmmmmmm, they thought.... "we are running deficits & borrowing money from citizens & countries at HIGH rates to cover it! Why don't we just borrow from the SS Trust funds & repay it later??". So... they made come cute little laws that allowed that to happen! Unbeknownst to them, the Trust fund would end up with a bunch of IOU's... no cash... no motherload... just IOU's that the governments have dropped into the fund (interest bearing, of course) throughout the years. The SS Trust fund is now a hobglobbin of IOU's & no way to pay it back. Are the books kept meticulously on this IOU game? You bet! Cuzzzzz... drum roll..... it's Trust Funds!
Move forward in the 'something wicked happened at the government level' and you'll find the worst of the worst. The folks at the governments noticed that the SS Trust funds were (theoretically... IF they could collect the IOU's) pretty solvent and.. well... the government branches were wayyyyyy out of budget constraints. Sooooo... they made a little law that said that "when viewing the Budget, the government can ADD the reserves held in trust at the SS together to see.. if on the whole... everything is balanced".
This means, dear heart, that the government deficit can be masked (in all reports) and appear balanced (in all reports) because the theoretically solvent SS Trust funds cover the loss.
This is NO different that having two houses in a neighborhood--> one home is inhabited by folks living paycheck to paycheck and borrowing from the bank to the hilt... the OTHER home is solvent, has savings, owes no one. The law, if used on those two separate, distinct homes, allow the authors & reporters to write: "The neighborhood is in financial balance".
It is simply not so. Be careful when you read reports & always remember that "solvency" for the SS Trust funds means that the American taxpayer is going to cough up the money for all the IOU's so that they can issue themselves social security checks that are backed by money. Or, a way around that forced tax collection--> reduce benefits... or print money to back the checks... ask another generation to pay the IOU's... or, commit political suicide and tell the American people what is really going on.
You have a bigtime "Bravo!" from me, that's for sure! Great insurance move!
Hope you're right, Eric
I just let GG go.... kinda upset... but today is a STRONG rally...
Time will tell :)
You two are going to meet??? That is great! Is this the first time??
Tell the truth, Nick! We bought like drunken sailors!!!
I can remember your statement to me.. "I like to sell when the VIX is 20 and will back up the truck when the VIX is 35+"
Those were the days... and, we all had trucks!
No sir... I am VERY excited!
Sittin' on all cash except for Oracle & GG.
Mr.Fibonnaci's method nailed the 11160... surprised that she headed south earlier... but very, very exhilerated.
Patience IS a virtue!!!
And my guess is that Miss Slaybaugh would have walked into the doctor's office... viewed the Medical Degree on the wall... and then ask "What was your GPA?".
The same certificate is handed the A+++ student as the C- student.
Patient beware... but, Miss Slaybaugh would have known what was at stake. At stake? Her person.
And, you know what's at stake. And, it is? Our nation & our nations future.
Yes. Grades count... on the small personal scale all the way the the national scale.
This is a disgusting article. Like a "tar-baby" (a bad educational system begets bad teachers who, then, beget bad students...)
That progressivism didn't just start recently... it is the progressivism of the teachers who taught the current teachers, who...
This is going to be very difficult. Seeing the dumbing of America before our eyes & hearing from every faction that was the root cause of the dumbing continue to defend their performance and reason is disgusting.
I hope I can catch the program tonight. I'll try.
This is a disgusting article. Like a "tar-baby" (a bad educational system begets bad teachers who, then, beget bad students...)
That progressivism didn't just start recently... it is the progressivism of the teachers who taught the current teachers, who...
This is going to be very difficult. Seeing the dumbing of America before our eyes & hearing from every faction that was the root cause of the dumbing continue to defend their performance and reason is disgusting.
I think you'll like this one Court:
An unemployed man is desperate to support his family. His wife watches TV all day and his three teenage kids have dropped out of high school to hang around with the local toughs. He applies for a janitor's job at a large firm and easily passes an aptitude test. The human resources manager tells him, "You will be hired at a minimum wage of $5.15 an hour. Let me have your e-mail address so that we can get you in the loop. Our system will automatically e-mail you all the forms and advise you when to start and where to report on your first day." Taken aback, the man protests that he is poor and has neither a computer nor an e-mail address. To this the manager replies, "You must understand that to a company like ours that means that you virtually do not exist. Without an e-mail address you can hardly expect to be employed by a high-tech firm. Good day." Stunned, the man leaves.
Not knowing where to turn and having only $10 in his wallet, he walks past a farmers' market and sees a stand selling 25lb crates of beautiful red tomatoes. He buys a crate, carries it to a busy corner and displays the tomatoes. In less than 2 hours he sells all the tomatoes and makes 100% profit. Repeating the process several times more that day, he ends up with almost $100 and arrives home that night with several bags of groceries for his family. During the night he decides to repeat the tomato business the next day. By the end of the week he is getting up early every day and working into the night. He multiplies his profits quickly.
Early in the second week he acquires a cart to transport several boxes of tomatoes at a time, but before a month is up he sells the cart to buy a broken-down pickup truck. At the end of a year he owns three old trucks. His two sons have left their neighborhood gangs to help him with the tomato business, his wife is buying the tomatoes, and his daughter is taking night courses at the community college so she can keep books for him. By the end of the second year he has a dozen very nice used trucks and employs fifteen previously unemployed people, all selling tomatoes.
He continues to work hard. Time passes and at the end of the fifth year he owns a fleet of nice trucks and a warehouse which his wife supervises, plus two tomato farms that the boys manage. The tomato company's payroll has put hundreds of homeless and jobless people to work. His daughter reports that the business grossed a million dollars. Planning for the future, he decides to buy some life insurance.
Consulting with an insurance adviser, he picks an insurance plan to fit his new circumstances. Then the adviser asks him for his e-mail address in order to send the final documents electronically. When the man replies that he doesn't have time to mess with a computer and has no e-mail address, the insurance man is stunned, "What, you don't have e-mail? No computer? No Internet? Just think where you would be today if you'd had all of that five years ago!" "Ha!" snorts the man. "If I'd had e-mail five years ago I would be sweeping floors at Microsoft and making $5.15 an hour." Which brings us to the moral: Since you got this story by internet, you're probably closer to being a janitor than a millionaire!
Bonner wasn't off topic. No apology. I'm worse than you :)
Oh nooooooo! I think I lost it, Eric! This can't be!
Toooooo funny! I emailed the site to everyone here.... thanks soooo much!
Eric!
We had a guy that watched the movie, then came to work & announced "It's National Pirate Day.... Arrrrrrrrgggggggghhhhhhh". He never flinched! Then, he proceeded to answer the phone all day with "Arrrrrggggggg... may I help you?"
By lunch, I was just dying! He passed every desk & Arrrrgggggghhhh'd. By days end, the entire office was Arrrrrrgggggggghhhhiiinnnnggg. In fact, we can't wait for next year's National Pirate Day ! Great stuff !
Hey, it works!
and the finish line should also be...
He's the guy that would do it all again in a heartbeat. No lesson learned.
Did you catch the Demise of the Dollar?? (very well thought out). Better yet, I read the intro on Empire of Debt & stayed awake... very upset... until the wee hours of the morning. Now, I'm waiting for a 'break' to pick the book back up. I don't think I'll enjoy the read... very disturbing.. very real.
Now then...
That's a scarey number (indeed) ! I have in my head that 7800 would be the low. Granted, I am ALWAYS keen to having my head shaved... so let's give it a stab --> how so 7250?? Would that be the point that pessimism stalls ( defined as an overshot extreme)???? I know you're trading all day, but if you get a chance, I'm all ears !!! (eyes, maybe?)
Really want to know... even if it's links...
Snug as a bug? That's it Richard. It's the critters again.
Color challenged??? That is goooooood!
Guys in brown? That's nice. I like that.
Gals in brown, two sizes too small... I don't like that!
And who am I?? The current applicant in the "Color Police" line...
I want the job... gotta have the job... will kill for the job.... Have Spectrum, Will Travel.
Here's my two cents... maybe even a nickel...
We are in a bear market. Bear markets can last for a decade. They can take two steps back... one step forward (maybe even 1 1/2 steps forward)... then two steps down. This goes on for a while. Can get tiresome.
From 2000 to March 2003, two steps back. From March 2003 to present, 1 1/2 step forward. Two steps back are in our future.
That's my simpleton way of stating that that we are in an "overall bear market"... that we are currently inside of a "cyclical bull market"... and that we will revert to the bear market once again. Cyclical bull markets last anywhere from 18 months to 3 yrs. Start counting from March 2003 & most folks would say we're due for the turn. In fact, all the cards are being placed as the market dances in the exurberance of the cyclical bull. THose cards WILL play. Watch the housing industry. It has propped up our economy... our commodities... our employment...
While we dance, the debt level of the USA is astronomical (both government & non-government). Our trade imbalances exceed all historical levels for ANY government EVER to operate on the planet and, "it matters"... this is NOT "this time it's different". We are going to pay the piper. Our manufacturing base (for the first time in our ENTIRE history) is net-net migration. Our reliance on consumption, "an accomodating Fed", the shakey dollar standard, the moves made by other countries to hold assets "other than dollar based assets" in reserve, the hinting of trading petro related commodities in Euro's rather than dollars........
When the American consumer, who currently uses their homes as an ATM machine wake up, the ugliness of the new bankruptcy laws will sock them between the eyes. No where to run... no where to hide. And... the financial system set the stage to make sure they remained healthy--> especially when the day of reckoning comes to the debtors. And...it WILL come.
All types of convergences... which one will be the tipping point? And when will it come???
I really believe we will dance 'til the DOW hits 11,160. Then it will be time for us to take a step back.
I'm an optimist. You'd never believe it by reading this post... but I have never been so inundated by red flashing caution lights as I have been over the past year. Never, never forget that the change of the Fed FOMC guard can be a catalyst in itself. Personnally, I don't see anything more than Bernanke wishing he'd never taken the post.
We'll see. But remember, a cyclical bull market brings about "feelings" of prosperity. It has always, without fail, done a "this time it's different" argument on the populus. It spins the tail that it won't be "two steps down, one step up, two steps down" again. That "This Time", it will be "two steps down, 3 or 4 steps up". A cyclical bull market has always set up the populus to "fully invest", then takes the motherload from them.
It's how you view history. It's how you view the "environment" which the cyclical bull market lives. Right now, I wouldn't say this country is anywhere NEAR the prosperity levels of a REAL bull market.
Be careful.
As it turned out... it was a dime.
JMHO
I'm for 11,160. Then she heads south.
OH NO!
Purple is W-O-R-S-E !!
Redundant... more "bombing"...
What can BROWN do for you??? Does she buy any other color? Nuttin' much for anyone else!!!
Gaaaaaadss... I'm in trouble now......
Well now...
It appears that ONE of the qualities IS NOT "color choice".
She bombed... admit it.
It's just like Krispy Kreme.
We saw it... we watched it.. we knew doughnuts & doughnut holes could NOT be more valuable that life itself. It's the herd. The momentum groupies.
And when they leave the party, the guy/gal holding the short will go allllllllllllll the way to the bank.
And when that happens, he'll need to invest in currencies other than the dollar.
If I click my heels 3 times... and say there's "no short like a Google short", will I wake up & nail the day that the groupies regain their senses???
We just GOTTA stay tuned! Richard's narratives on the attributes of Krispy Kreme are legendary. Can't wait for the Google narratives. THat's a fact!!!
Gaaaaaaaaaads!!!!!! I fell out of my chair again!!!
My sides are aching!!!
It's just GRAND to read a market thread these days!!!! (and I thought I'd just check in... in "secret"...... nahhhhhhhhh... you foiled it for me!)
Thanks! Tips off a t-o-u-g-h day!
I am sooooooooo excited about the future! I am delegating workloads faster than ever... finding some relief at every turn (even though I know that Year End accounting is coming)... watching copper daily and feelin' that (yet ANOTHER sign) copper has peaked (which has always indicated an economic downturn thereafter... usually sometime within a year).... and that a great deal of good fortune can come to those who have read tea leaves [[[ and understand them ]]] for years. You are g-r-e-a-t with charts. Don't be offended that I call them "tea leaves"... even though a chart is "where you've been", the "tea leaf" comes with rational thought as to where the lines will eventually go on the right hand side of the chart.
The "right hand" guesswork is not easy. Lots of rationale, but few people really nail it. I've seen you nail it.
And... with that... I'll keep reading & learning.
It's gonna be "Jacque Daniels & Koke" (for those who love encrypted code) for me & John Wayne!
Gaaaaaaadssssss ! I will NEVER have to worry about "betting the farm" again. And THAT is worth celebrating!
Court,
What'd you think of the cartoon (on a post here... Dec 22?) which had a cowboy asking "which way to Cow Hampshire"???
I fell off my chair laughing!!!!!!! It was g-r-e-a-t !!
I hope I can contribute more. I've learned soooooooo much over the years from all of you.
It's like family.
I like your thinking trail. Very logical.
It isn't just Nick thinking that way, it is the signs that are at every turn.
These markets WILL shake out the excess. We are in a bear market 'overall' trend with a very, very nice counter trend rally from March 2003. The bear market will resume; nasty; just be aware that it's coming. The biggest sign, like I stated earlier, was the death nail of an inverted curve. That 'inversion' is a clear signal (not just a "sign").
Given that bear market trends have existed before this date, they were NOT occuring during the era's of astronomical debt; they were NOT occuring during era's of manufacturing absenteeism; they were NOT occuring during massive current account imbalances; they were NOT occuring during a time when homes/commercial construction made up 50% of our economy... need I go on?
We've concocted a very disturbing brew here... and a bear market 'clawing' in this NEW and UN-IMPROVED environment can be pretty doggone tough...
In 18 days, the farm will be paid off (yeeeeeeeeeeeeeeeehaaa!). All 200+ acres (think seagulls in Nemo-->>> MINE, MINE, MINE !) will be ours!! Visit again anytime! But the opportunity to have cash when the market drops [[[ and it WILL drop ]]] can NOT be missed this time 'round.
Hi Nick!! You must know that I gravitated back here like a magnet. Miss you all sooooooooooo much!
John Wayne is doing great. We might have one more surgery, but otherwise he is trying to be his old self.
Wanted you to know that I've tried to read all posts... sometimes sitting for hours just reading. Was sooooooooo worried about you during hurricane season that I checked in more frequently. I've missed a few blocks here & there; just wanted you to know that I'm still here!
Also, very (VERY) glad to see Richard post. He knows it... probably will get the 'big head'... (hahahahaha! THAT'LL be the day!!)
Can't wait for closing out 2005 !!!!! Just want to get a fresh start on 2006!
....students learn best when they are disciplined, motivated, and have supportive parents...
I absolutely agree. But I must also add that we memorized 'seemingly meaningless' things by ROTE. The dictionary definition is better than I can state otherwise--> [[ rote: By memory alone, without understanding or thought ]]
Rote is the most powerful tool our educational system has... and they tossed it away in favor of "understanding as you learn". "Understanding" comes when the mind & maturity of the student is ready for it. When is the last time you spoke with a high school student who could even begin to fathom the repercussions of an upward interest rate move on their dream for a home? Of the 'extra toil' that would THEY would have to endure to m-e-e-t the rising interest rate? Do they understand that their "I want" list would then remain unfilled? That they must change a l-i-f-e style???
If they had learned their math by rote, the understanding would take only seconds. The data would have been there ---> the understanding of the "concept" would have taken fractional seconds. Almost a "Gaaaads! I g-e-t it!!"
Well now... my little dance with "rote" through high school made me understand immediately what an interest rate level meant... and, at the ripe young age of 17, I bought my first new car & haggled til I got the price & rate I wanted.
I truly believe that 'rote' and 'discipline' are absolutely necessary in the educational arena. Without those two things, we merely hope that the child 'gets it'.
Otherwise, "do it now... we'll tell [or the world will teach you] "why" later"....
Hi! Long time no write!!
The present inverted yield curve is e-x-t-r-e-m-e-l-y important. With the exception of ONE TIME (Russia, 1998?) an inverted yield curve signaled a recession within 6 months. And, everytime (except that Russian meltdown), a serious one to two year recession followed.
I have stated emphatically that I will not get the "nervous jitters" until I see the yield curve invert.
Jitters just set in.