Heisenberg Knocks at Ray Dalio’s Door

Heisenberg’s take on Ray Dalio’s new LinkedIn view on inequality. Bile ducts everywhere, rejoice.

See, it’s not that hedge fund managers are virtue signaling from the comfortable confines of their weird forest kingdoms, and it’s not that fake populist Presidents are feeding uneducated white Americans a big ol’ plate of steaming bullshit just so they can get elected and pass tax cuts that save their own families $1.1 billion, and it’s not that millionaire bloggers are just spewing outright lies and clickbait conspiracy theories in order to buy expensive toys and lounge around in their mansions with pet poodles. No, that’s not what it is. None of that is true. I swear.

The truth, rather, is that Janet Yellen is out to get you.

via Let’s Listen To Ray Dalio Explain How Janet Yellen Is Creating Inequality |

Why So Few Will “Retire” Comfortably

Serial blunders in the structure of retirement vehicles, especially Social Security, explained. A long post on Naked Capitalism, well worth reading – including the comments. From the embedded interview of Michael Hudson:

The Federal Reserve has just published statistics saying the average American family, 55 and 60 years old, only has about $14,000 worth of savings. This isn’t nearly enough to retire on. There’s also been a vast looting of pension funds, largely by Wall Street. That’s why the investment banks have had to pay tens of billions of dollars of penalties for cheating pension funds and other investors. The current risk-free rate of return is 0.1% on government bonds, so the pension funds don’t have enough money to pay pensions at the rate that their junk economics advisors forecast. The money that people thought was going to be available for their retirement, all of a sudden isn’t. The pretense is that nobody could have forecast this!

There are so many corporate pension funds that are going bankrupt that the Pension Benefit Guarantee Corporation doesn’t have enough money to bail them out. The PBGC is in deficit. If you’re going to be a corporate raider, if you’re going to be a Governor Romney or whatever and you take over a company, you do what Sam Zell did with the Chicago Tribune: You loot the pension fund, you empty it out to pay the bondholders that have lent you the money to buy out the company. You then tell the workers, “I’m sorry there is nothing there. It’s wiped out.” Half of the employee stock ownership programs go bankrupt. That was already a critique made in the 1950s and ‘60s.

via Michael Hudson: Retirement? What Social Obligation? | naked capitalism