Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Take the Money and Run -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (3604)	6/17/2002 7:30:19 PM
From: Alan Smithee	Read Replies (2) \| Respond to of 17639

What types of raw materials?

To: Jorj X Mckie who wrote (3604)	6/17/2002 10:13:18 PM
From: Lazarus_Long	Read Replies (1) \| Respond to of 17639

You actually turn the sound on? :-) More reason to be bearish: What if this idea spreads? usatoday.com Writers say approach 401(k) with caution By Kerry Hannon, special for USA TODAY The Great 401(k) Hoax is a hard-hitting evaluation of 401(k) plans, and charges they are Corporate America's way of sidestepping providing pensions for employees. William Wolman, a senior contributing editor at Business Week magazine, and Anne Colamosca, a former staff writer at Business Week, deliver a disturbing message. Be prepared. It's a bleak tale, but it couldn't be more engrossing. The American public was hoodwinked, they write, about the gradual erosion of the nation's retirement system. The "going it alone" endeavor ruled the day in the 1990s, with the 401(k) plan portrayed as the perpetual wealth machine. In their estimation, most Americans are grossly unprepared for retirement. They predict a looming retirement crisis in the USA. They report that, adjusted for inflation, the average American family did not reap the rewards of a stock market that was, overall, robust from 1983 to 1998. The median 401(k) account at the end of 2000 was only $13,493, down from $15,241 in 1999 — meaning half are below that amount and half above. The authors say it's a fantasy that it's always a good time to invest in stocks and that a 401(k) will more than compensate over the long haul for a decline in wages. They remind us that during president Ronald Reagan's two terms, layoffs became common, company benefits were cut and, to make ends meet, two-worker households became common. The gist of their theory is that economic growth is likely to slow and the stock market to stagnate. They present a compelling argument, comparing the 1990s economy with the 1920s' pre-Depression hoopla and tumble. Wolman was Business Week's chief economist in the 1990s. Don't get too bogged down in statistics. The text can be a bit pedantic and academic, but the overall theme is strong. It's all about economic hocus-pocus, they write. Real wages are going down, as they did in the 1920s, and Americans are going to face difficult financial challenges as they age. It's the incredible shrinking pension. There's a contrarian argument for choosing bonds as an investment strategy in the next decade. Caution might be the best way to a comfortable retirement.