Dedicated to Deposits: Deals, Data, and Discussion
Featured Savings Rates
Featured Accounts
Back to Financial News

Editorial - How Retirees Saved the Banks [NYTimes]

Monday, January 18, 2010 - 9:38 AM
From the
The effect of the financial crisis on retirees - and planning for retirement - has been largely overlooked. It deserves a high place on policy makers’ agendas.
This is another good commentary about how savers and retirees are paying a high price in rebuilding the banks. Perhaps we should send a link of this to our lawmakers?
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,743
1. Tuesday, January 19, 2010 - 3:55 PM
I'm sure nearly all of our law makers are aware that the Treasury/Fed/Banks driving REAL interest rates into negative territory creates a climate where REAL wealth is taken from people.  Adding injury to injury, in order to create the negative REAL interest rate environment, the US has a) greatly increased its debt, using much borrowed money for purchase programs to drive interest rates down, and b) effectively printed more money on top of that.  Thus countless retirees and savers will not only have REAL wealth taken from their savings accounts, they will ALSO experience higher tax rates (on those lesser interest incomes) in the future and ALSO have to deal with the potentially severe consequences of unsustainable US debt and US Dollar devaluation.

Unfortunately, very many if not most people do not think in terms of REAL returns and the potential longer term consequences of what is being done.  Even those with more substantial wealth... those who have seen their investment accounts reflated somewhat and who think things are better, don't appreciate the consequences because they haven't seen the bills yet.  Effectively, they might as well have taken out a large [additional] loan and placed that borrowed money into their investment account.  Does the increased balance in their investment account mean they are now ahead of the game?  No, because there is no free lunch... what was done to make those gains happen will cost them even more than that in the long run.  The gains are but a mirage.

If something were to be forwarded, perhaps it should be forwarded to those US citizens that are getting BLEEPED over.  Especially those who have been and still are fiscally responsible.  We are witnessing one of the greatest thefts of wealth in the history of the USA.  There will be no stopping it if most of the current government officials remain in power.  We must treat the future near term elections as if our life depends on the outcomes.  It pretty much does.

Sorry for the rant, but you know how it is.
AnonymousAnonymous2,281 posts since
May 9, 2010
Rep Points: 3,788