I can’t believe it. A Congressman from New York (where else) wants to allow pension funds to invest in troubled banks:
My favorite line from the article is this:
“Some of us are getting tired of writing checks with public money” and seeing no results, Mr. Ackerman said
I’m sorry, I manage money but maybe I’m dense – what part about that statement would entice pension funds to invest in these banks? If government funding is yielding “no results,” why would we want our pension money there?
What is rather amusing is that, with all of our bailouts, I have been frequently comparing our government to shaky South American governments. And in that same light, this policy is somewhat similar to Argentina’s president’s plan to use government pensions to, bailout errr, excuse me to “protect the pensions from global market turmoil.” More crap from a another loser politician, just in a different country (read more on President Cristina Fernandez’s plan HERE). In Argentina it’s basically a back door move to allow the government to use pension money for its operations – doesn’t this sound teamsterish/Jimmy Hoffa type stuff to you? (read another Reuters article HERE on Argentina). (What amazes me continuously, is that with all the financial turmoil and mismanagement in some South American countries, their financial models still seem to be attractive to many of our leaders here – I don’t get it!)
Here in the USA, instead of bailing out the government (I guess freeing the government from “writing checks with no results” DOES bail out the government) we will throw the pension people under the bus so pensioners can all share in the poor performance of our biggest banks. with their government! On a side note, some local and regional banks have been holding up well. Perhaps the problem is with the size of the bank (or the egos of the people leading them?
And if you find that Argentinian plan to be odd if not outright criminal, be warned that we have a few “enlightened” academics here in the US that want to do something a bit similar to this with our 401(k) system (funding retirement plans with inflation-based government bonds) – and these academics have listening ears in the White House.
THIS STUFF DOES AFFECT YOUR FINANCIAL PLANNING. IF GOVERNMENT WONT CONFISCATE YOUR MONEY WITH HIGH INFLATION, THEY WILL DO IT DIRECTLY WITH SCHEMES LIKE THE ABOVE. You best be keeping an eye on your elected officials. Soon they may be shaking you down. If you’re still not sure, listen to this Peter Schiff interview: