Subject: RE: I'm For Personal SS Accounts: Here's Why.-not
>>>>>>>> phyllis joffe wrote:
Annuities with their fixed and low returns rejoice everytime a person buys an annuity. They stand to make money on the instrument.
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1) Absolutely! and if you're a stock holder, you will make money as well.
>>>>>>>> phyllis joffe wrote:
The mutual funds which were mentioned do a great job of investing other folks money but they do not go up without interruption.
They sometimes go down and for many years there performance is flat indeed.
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2) I agree 100% that invesing in the private markets involves short term risks; however every 20 year period since before the great depression, stocks and bonds have returned in excess of 8% which is far better than the expected return of treasury bonds, and SS contributions.
>>>>>>>> phyllis joffe wrote:
And money does not, in and of itself, build wealth.It may be great score-keeper but it doesn't build wealth. Factories and
production build a gross national product which builds wealth.
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3) I agree that if you kept your money in your pocket, spent it, or kept it under the mattress, it wouldn't create anything for you; however, if invested in one of the hundreds of ways available to the common man today that money would create the factories and all the other good things that increase the GDP; thus, your money can create wealth for you.
>>>>>>>> phyllis joffe wrote:
Politicians have 'dipped' into social security funds to finance programs with shortfall, without being required to pay it back, and this
has impacted the financial stability of the program.
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4) I beg to disagree here; even if the fed were to pay all it's taken from SS, which it has to, the trust fund and future payroll taxes still would not be enough to cover the benefits of future recipients. That money, owed by the fed to SS, is used in all calculations of solvency of the system, so the use of the money by the fed is inmaterial to the solvency of the program. On the contrary, borrowing by the fed is what provides the investment returns of our payroll $$$. Now a problem that grows out of the use of SS funds is that in the future, when SS needs its money back, the fed will have to generate the revenue to pay the IOUs, which in today's tight budget situation means higher income taxes, higher payroll taxes, and/or higher borrowing. Higher payroll taxes equal more borrowing because those dollars would be used to cover for debt owed by the fed at that time.
The solution suggested by the President of saving 62% of the projected surpluses to save social security is bogus because it only pays what is owed ss and does nothing to fully fund the system, it only pays back the owed money which is already counted by the projections which show the system going bust. Moreover, the money would sit idle without generating any additional wealth, which takes us back to point 3 above.
