Mohacsy's Safe Portfolio Member Forum

[RichardTC]

What we haven't seen yet is what happens when benefits run out. There's a huge difference between fair value and liquidation value. When you can't find work, your government unemployment benefits run out, your credit cards are tapped out and your minimum payments have skyrocketed, it's time to make some very hard decisions. The penalty for liquidating your 401k/IRAs is 10% and that penalty can be deferred until you file your taxes. If the economic decline is sustained (and I believe it will be), you're going to start seeing significant liquidation of investment portfolios as people scramble to survive. That's one thing that I don't think the market is adequately handicapping.