Show Me The Money!!

[Misty_Morning]

or, rather...


Show me where the fuck the money went.


See, I am kinda ignorant in some aspects concerning money.

In the past decade the US and most of the world prospered.

Now...it's gone.

Where did it go?

It didn't just go *poof* into thin air.

Was it ever really there?




All I know is that I have been extremely frugal over tha past decade cuz I just couldn't believe that "everyone" had that kind of cash.

Was it all just a shell game?

Nothing but paper?


The money went SOMEWHERE....Where the fuck did it go?

 

[Safe_Bet]

or, rather...


Show me where the fuck the money went.


See, I am kinda ignorant in some aspects concerning money.

In the past decade the US and most of the world prospered.

Now...it's gone.

Where did it go?

It didn't just go *poof* into thin air.

Was it ever really there?




All I know is that I have been extremely frugal over tha past decade cuz I just couldn't believe that "everyone" had that kind of cash.

Was it all just a shell game?

Nothing but paper?


The money went SOMEWHERE....Where the fuck did it go?

Words of wisdom for you from Amy:

The "money" never existed. What existed was "debt" The problem is that the "debt" is getting called and there isn't enough "money" to cover it = insolvency.

 

[voluptuary_manque]

Words of wisdom for you from Amy:

The "money" never existed. What existed was "debt" The problem is that the "debt" is getting called and there isn't enough "money" to cover it = insolvency.

Yeah, what everyone thought of as money was "value" and when the "value" dropped due to insolvency, the money that had been spent to buy the "value" was lost into nothingness. It wasn't like there was a huge pile of $100 bills that caught fire or anything.

 

[trysail]

Darlin', there's a world of difference between "quotational value" and "intrinsic value." Warren Buffett's entire career ( and considerable fortune ) has been devoted to and derived from his extraordinary ability to recognize and exploit the difference. The man has always worked like a dog; in his early years, if it wasn't for his wife, Susan, he might well have starved to death simply from neglecting to eat.

"Quotational value" is ephemeral; "intrinsic value" is forever. "Quotational value" is simply the marginal price of the last transaction and does not necessarily reflect the reality of an informed buyer and an informed seller. Notwithstanding all the combined forces of the loudmouths of Wall Street and MSNBC, stock market prices are only quotational values. In the short run, the stock market is a voting machine; in the long run, it's a weighing machine.

It is not impossible that current quotational values are depressed; the stock market is a discounting mechanism and "Mr. Market" is well-known for his manic mood swings. There's an enormous amount of fear abroad— and a good deal of blood has been spilt in the street. Perhaps some of it was only quotational.

You are wise to be frugal and thrifty; these are good habits that will serve one well over the course of a lifetime.

 

[Misty_Morning]

You are wise to be frugal and thrifty; these are good habits that will serve one well over the course of a lifetime.

Yes, I watched my money. But I also put my money into pretax investments. I never really felt confortable doing that cuz it never really made sense...by that, I mean...IF I want to lower my taxable income I need to take a chance.....

WTF can I not take the same tax break and invest my money in lower yielding risks?

I was only offered certain options.

WHY...WHY...do I have to take chances with my money just cuz the company I work/worked for says its accepteple?

The money that I invested to lower my taxable income is gone....

I am now working for a small business where every dollar counts.

IF I decide to invest my money...at least I know where the money goes...


And yes...I would invest in my future....cuz I KNOW WHERE THE MONEY IS GOING!!!

 

[Guest]

Yes, I watched my money. But I also put my money into pretax investments. I never really felt confortable doing that cuz it never really made sense...by that, I mean...IF I want to lower my taxable income I need to take a chance.....

WTF can I not take the same tax break and invest my money in lower yielding risks?

I was only offered certain options.

WHY...WHY...do I have to take chances with my money just cuz the company I work/worked for says its accepteple?

The money that I invested to lower my taxable income is gone....

I am now working for a small business where every dollar counts.

IF I decide to invest my money...at least I know where the money goes...


And yes...I would invest in my future....cuz I KNOW WHERE THE MONEY IS GOING!!!

Start a Roth IRA.

 

[fifty5]

...

It didn't just go *poof* into thin air.

Was it ever really there?

Well, yes and no. Money, something like religion, is a matter of faith. Read a bank note. It says something like, "I promise to pay the bearer on demand..."

Basically, all paper money is a collection of IOUs.

The same goes for all debt: as long as folk do pay up, eventually, then the faith is justified.

Unfortunately, some silly fuckers - egged on by offers of bonus payments from even sillier fuckers - loaned money to folk who couldn't pay back the loans.

Up the tree, those even sillier fuckers tried to cover their back by selling the "assets" of those repayments to other fuckers who were even sillier than the first and second lot.

And in due course, those who couldn't afford the repayments didn't make them...

Suddenly, the house of cards fell down and the faith evaporated - the world stopped believing in those IOUs.

Including the ones from governments which depended on the ability of those who were actually doing stuff to pay taxes: if those folks stopped making a profit, they wouldn't pay tax, so the government IOUs wouldn't be worth anything either.

So everyone is in the shit!

If the US government don't bail out the automobile companies, then they (and all the support companies) won't just stop paying profit taxes, but their ex-employees will want to get social security handouts... so what does that do to the faith in the promise on banknote-IOUs go then?

The same goes for the UK and its 'industries' - and since one of our big ones is the banking 'industry', even more so.

And so on globally...

Suddenly, the faith that backed all those IOUs is lost.

Money never was worth any more than the faith that its IOU would be honoured.

Now that faith is damaged, the money vanishes in proportion.

Folk who are in credit - and with income - don't suffer too badly. Unfortunately, the general faith - especially in business - has been that it makes more sense to operate using someone else's money (i.e. debt) than to do so with real assets. All such are in deep shit. The banks and other creditors suddenly found that the loans aren't what they had faith such 'assets' were worth isn't justified - so they wanted to foreclose.

On the same basis, such businesses suddenly had to pay up, since the faith that they would do so in the future had evaporated.

Faith, or "confidence" isn't there any more - and money IS faith.

It's disappeared in so far as the faith/belief has disappeared.

This time, it isn't that someone took it, just that folk don't believe those IOUs will be honoured.

 

[Misty_Morning]

Start a Roth IRA.

Yep. got one.

Almost worth nothing.

Just like the others.

 

[Guest]

Yep. got one.

Almost worth nothing.

Just like the others.

Talk to your agent, then. Have them transfer into safer investments, at least for the short term.

 

[rgraham666]

All values are a matter of the imagination and the individual's perception.

As long as we recognize that we'll be okay.

But thanks to silly things like derivatives and ABCPs we forgot that. we allowed our imaginations to run amok and our perceptions became warped.

Reality reasserted itself, as it always does, and all that 'money' disappeared. Because it never really existed.

 

[Misty_Morning]

Talk to your agent, then. Have them transfer into safer investments, at least for the short term.

I am thinking of cashing out and taking the hit on taxes, at least then I know I will have "something" left...whereas if I wait any longer....some of my investmensts will be nill...

 

[Guest]

I am thinking of cashing out and taking the hit on taxes, at least then I know I will have "something" left...whereas if I wait any longer....some of my investmensts will be nill...

There's a penalty, depending on how your money is invested. Annuities may need to be in 5-7 years and you pay a fee for withdrawal, along with taxes, along with a ten percent penalty 1099 tax.

Your Roth money is yours no matter what. You already paid taxes on it and any principal you withdraw is not taxed - if you take out interest earned before you are 59 1/2 then THAT will be taxed.

Is there enough in the Roth or can you take a loan out of the annuities?

 

[Misty_Morning]

There's a penalty, depending on how your money is invested. Annuities may need to be in 5-7 years and you pay a fee for withdrawal, along with taxes, along with a ten percent penalty 1099 tax.

Your Roth money is yours no matter what. You already paid taxes on it and any principal you withdraw is not taxed - if you take out interest earned before you are 59 1/2 then THAT will be taxed.

Is there enough in the Roth or can you take a loan out of the annuities?

The Roth is only about 4k...well..less than that now....it wasn't ever intended to be a major investment. it was a left over from my other life, some thing that I forgot about till recently ....

 

[Guest]

The Roth is only about 4k...well..less than that now....it wasn't ever intended to be a major investment. it was a left over from my other life, some thing that I forgot about till recently ....

Good luck, Misty.

 

[SeaCat]

And people wonder why I have been purchasing such things as Gold,Platinum and gem stones?

No I don't buy the paper. I insist on the actual object. I buy in either stones or Troy Ounces. I have them squirreled away in case of emergency.

Yes I'm sure it's probably illegal but what the hell. I can survive. Precious metals and stone will always have value.

Besides, it hard to tax what doesn't show up on the radar.

Cat

 

[Liar]

Yes I'm sure it's probably illegal but what the hell.

Why in the name of the holy hegehog would that be illegal?

Precious metals and stone will always have value.

Precious metals and stones IS money. They have very little practical value, but are worth a lot because we all agree they are.

I'd invest in iron and beef. But it's a bitch to store.

 

[voluptuary_manque]

Why in the name of the holy hegehog would that be illegal?

Because this is America? Who knows? It probably isn't but why let any officialocrat know about it anyway?

 

[trysail]

One hundred years from now, enterprises such as Nestlé, Proctor & Gamble, Clorox, Colgate, Kraft, Pepsi, Coca-Cola, Campbell Soup and Unilever will still be selling soap, toothpaste, razors, cosmetics and food.

Each and every day these companies receive euros, yen, renminbi, pesos, rubles, pounds, dollars, bolivars, francs, rupees and reais in exchange for the basic, valuable necessities they provide to billions of people.

They are managed by some of the best managers in the world, they are generally unleveraged and they display most characteristics of good corporate governance.

The cash dividends that these companies have paid to their shareholders have grown over the years and are almost certain to continue growing for many years to come.

 

[voluptuary_manque]

One hundred years from now, enterprises such as Nestlé, Proctor & Gamble, Clorox, Colgate, Kraft, Pepsi, Coca-Cola, Campbell Soup and Unilever will still be selling soap, toothpaste, razors, cosmetics and food.

Each and every day these companies receive euros, yen, renminbi, pesos, rubles, pounds, dollars, bolivars, francs, rupees and reais in exchange for the basic, valuable necessities they provide to billions of people.

They are managed by some of the best managers in the world, they are generally unleveraged and they display most characteristics of good corporate governance.

The cash dividends that these companies have paid to their shareholders have grown over the years and are almost certain to continue growing for many years to come.

And why? Because they make products that people can touch, actually use, and either work or go off the market. That business called "investment banking" made nothing, dealt only in dreams and ended up being just like every other bubble in history starting with the Dutch Tulip madness and working its way through the South Seas bubble right up to the present day. Do you wanna know what the real reason for the sky-rocketing price of oil was . . . ? Hmmmm . . . ? All bubbles eventually burst.

 

[trysail]

And why? Because they make products that people can touch, actually use, and either work or go off the market. That business called "investment banking" made nothing, dealt only in dreams and ended up being just like every other bubble in history starting with the Dutch Tulip madness and working its way through the South Seas bubble right up to the present day. Do you wanna know what the real reason for the sky-rocketing price of oil was . . . ? Hmmmm . . . ? All bubbles eventually burst.

Yup.

I submit that it is also very likely that companies such as Royal Dutch Shell, British Petroleum, Total, S.A., LUKoil, Gazprom, ExxonMobil, ConocoPhillips will also be around a hundred years from now efficiently and cost-effectively discovering, producing and refining the energy resources that enable and power civilization. Throughout its entire history— from the day Col. Drake drilled the first well in 1859 up to the present day— the hydrocarbon business has always been cyclical; it has always had booms and busts.

There is a place for investment banking. Society has a need for the capital formation required to finance important enterprises. Truly innovative firms such as Cisco, McCaw Cellular, Oracle, Microsoft, Apple, Genentech and others have brought benefits to society. I don't invest in that sort of stuff but I certainly use their products.

We have seen the investment bankers wreak havoc when they abuse their capabilities and their clients with too damn much financial engineering, the creation of completely unnecessary "products" that exist for the sole reason that they can be sold to the gullible and naive. They have a long history of wretched excess, shady practices and "me-too" nonsense— be it IPOs, CDOs, MBSs, derivatives and other garbage. They and their "financial advisers" should never be trusted. It's never been a good idea to mix salesmen and money.

I trust Goldman Sachs, Merrill Lynch, UBS, Alex. Brown, Morgan Stanley and their ilk about as far as I can throw them.

The mutual fund industry is also guilty of a great many sins— not the least of which is the total abdication of any fiduciary obligation to their clients. Fidelity, T. Rowe Price, Eaton Vance, FranklinTempleton, Janus and virtually every other firm in the business should be ashamed of having created, marketed and sold the thousands of utterly preposterous funds that serve no legitimate investment purpose. There is no earthly reason for the existence of such obscenities akin to "Mid Cap Micronesian Growth Fund" or the "Asian Small Cap Value Fund" or "The Growth and Income Fund" or the various industry funds. That sort of crap exists for the sole reason that it can be sold. The fees charged by the mutual fund industry are unconscionable and indefensible— a point that Jack Bogle has proven beyond any shadow of doubt.

 

[trysail]

$ 100,000 invested in the S&P 500 on 1 January, 1977 would now be worth:

$ 867,113
if all the dividend income had been spent along the way
[ and there were no taxes and no fees ] and

$ 2,329,370
IF all the income had been reinvested
[ and there were no taxes and no fees ].

 

[trysail]

As of last night's close ( at 942.87 ), the Standard & Poor's 500 Stock Index has produced a POSITIVE return of 5.68% for 2009 ( year-to-date ).

The S&P is UP over 39% from its low close of 676.53 on March 9th.

 

[JAMESBJOHNSON]

TRYSAIL

Firing all your employees, getting money from the government, and groovy reules and regs from Congress wont do shit unless you have customers for your wares.

What we're doing right now is shaking down average Americans to make the fuckups good again.

We're breaking every convention of good business practice, and everyone thinks its grand.

 

[CharleyH]

The money went SOMEWHERE....Where the fuck did it go?

I made good investments. If money disappeared out of your pocket, then it probably went to mine. THANK YOU

 

[Handley_Page]

Up the tree, those even sillier fuckers tried to cover their back by selling the "assets" of those repayments to other fuckers who were even sillier than the first and second lot.

And in due course, those who couldn't afford the repayments didn't make them...

Suddenly, the house of cards fell down and the faith evaporated - the world stopped believing in those IOUs.

I do wish that the "funds managers", merchant bankers and their hangers-on had realised that those with insufficient income COULD NOT afford the repayments, and just get stuck with houses they cannot sell, rather than passing the whole bloody mess on to the ordinary tax payer.