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this comment can be summarized like this: https://i.redd.it/jbab7jrhvt211.gif https://i.redd.it/jbab7jrhvt211.gif after three major financial crises in the pas
by kome 2y ago
this comment can be summarized like this: https://i.redd.it/jbab7jrhvt211.gif https://i.redd.it/jbab7jrhvt211.gif
after three major financial crises in the past 20 years, it’s hard to call private finance “safe” from ponzi-like risks. more than a quarter of Americans have no retirement savings at all, and the 401(k) balance for near-retirees often falls well below $100,000.
but it's the logic of the argument that is faulty: declining birthrates also hurt private markets, which rely on a growing workforce just as public pensions do. do you think finance is somewhat magical? if there is no growth also the financial markets won't grow. pensions shouldn't be about growth, but they are mainly about redistribution.
if we dismiss public pensions as a ponzi scheme, then by the same logic, private plans—completely at the mercy of market swings—could be called ponzi too, except they often leave those who earn less with nowhere to turn when things collapse.
- KK7NIL 2y ago> declining birthrates also hurt private markets, which rely on a growing workforce just as public pensions do. Right, it's well known that the US' demographics are the foundation for its strong economy, not advancements in productivity and technology. /s > if there is no growth also the financial markets won't grow. Financial markets don't need to grow for your investments to pay off. Investing into growth stocks is very popular now a days but value stocks (which might not grow at all but have profitable operations) and fixed income are perfectly good options too. > if we dismiss public pensions as a ponzi scheme, then by the same logic, private plans—completely at the mercy of market swings Some of them can be, the difference is that public pensions are a Ponzi scheme I'm legally forced to contribute to and have little say in. Not so for private plans.