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MyRA - More About Getting Votes Than Helping Middle Class

Tyler Durden's picture




 

Submitted by Lance Roberts of STA Wealth Management,

During this week's State of the Union address the President stated:

"Let’s do more to help Americans save for retirement. Today, most workers don’t have a pension.  A Social Security check often isn’t enough on its own.  And while the stock market has doubled over the last five years, that doesn’t help folks who don’t have 401ks.  That’s why, tomorrow, I will direct the Treasury to create a new way for working Americans to start their own retirement savings: MyRA. It’s a new savings bond that encourages folks to build a nest egg.  MyRA guarantees a decent return with no risk of losing what you put in.."

While there are few details available about the actual structure and makeup of MyRA, here are the details we know so far.

  • MyRa's would be structured like a Roth individual retirement account. Similar to savings bonds, the investments would be backed by the federal government.
  • Because the investments would be structured like savings bonds, there would be principal protection, meaning the account balance couldn't go down.
  • There would be an initial pilot program for companies to sign up to offer the accounts to their employees, and firms have until the end of 2014 to participate in the initial phase.
  • Workers would be allowed to invest if they make less than $191,000 a year.
  • There would be NO tax penalty if the investments are withdrawn.
  • Initial investments could be as low as $25 with subsequent investments as low as $5.  These investments could be automatically deducted from an individual's paycheck.
  • Once an individual accumulates $15,000, or they have the same account for 30 years, it would have to be rolled over into a traditional IRA.

Here are my initial thoughts.

1) While the President said that these "MyRA Savings Bonds" would offer a "decent" rate of return, he did not disclose how these investments would be structured.  However, if we assume that these accounts will offer the same variable interest-rate return as the Thrift Savings Plan Government Securities Investment Fund, that rate of return was 1.47% in 2012 while the rate of inflation, based on CPI, ticked up 2.08%.  With interest rates now bottoming, and many expect a continued rise in the future, that rate of return may continue to be less than the rate of inflation for the foreseeable future.

2) As I have discussed in the past, the large majority of American's live paycheck to paycheck.  American's do not lack for a vehicle to invest savings in for retirement (Roth IRA's, IRA's, 401k's, SEP's, etc.) but lack the ability to save.

3) The problem that needs to be addressed is from the economic front.  With 92.8 million individuals excluded from the work force, 1 in 3 American's on some sort of Government assistance, stagnant wage growth over the last 5 years and 1 in 5 on food stamps, the issue is about employment rather than saving.  Solve the employment problem in America and the retirement savings dilemma will begin to resolve itself.

4) There is no real incentive for anyone to actually use the "MyRA" as it has a limit of $15,000 for retirement but rather a high-yield, government guaranteed, savings account.  Since there is no penalty to withdraw money from the MyRa at any time there is also no incentive to use it to actually save for retirement.  However, if we assume that the rate of return is equivalent to Thrift Savings Plan of 1.47% that is significantly higher than what banks currently pay.  The incentive will be to use the MyRA to save for future consumption rather than future retirement.

5) Investors have a VERY poor track record of investing in the financial markets and typically fall prey to the emotional mistake of "buying high and selling low."  Given that the MyRA has to be transferred to an IRA after reaching $15,000, the guarantee of a "protected investment with a decent return" is gone.  Furthermore, there is a disincentive to reach the $15,000 level as it will change the account from a NO PENALTY withdrawal to one with a 10% withdrawal penalty prior to the age of 59 1/2.

6) Lastly, the limit of $15,000 on the MyRA is rather pointless.  If the goal is to help people fund their future retirement, the limit is rather ridiculous.  Today, if you assume that a portfolio of bonds could deliver an annualized living income of 4%, a retired couple could look forward to living a middle income lifestyle once you factor in social security income.  However, such an asset level only exists at the top 10% of the population leaving a large swath of individuals undersaved and underprepared for retirement.  A $15,000 MyRA account is going to do very little to change the dynamic of the lower 90%.

It seemed to me that the entire point of the MyRA was really more of about getting "votes" than actually helping middle class American's substantially change their retirement futures.  While the entire State of the Union address was littered with "bodies of past ideas" there was little new about changing the direction of the economy, increasing employment opportunities for the younger generation or resolving the issues of spiraling health care costs.

While Obama did make it clear roughly 11 times during the speech that "he has a pen and a phone" to resolve issues on his own - maybe it is time to start working with Congress through the Constitutional process to deliver real ideas, real reform and a better future for middle income Americans.   But then again, that is likely to be considered radical thinking.

Hopefully, this time, "if you like your current retirement plan" you will actually be able to keep it.

 

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Thu, 01/30/2014 - 23:15 | 4386565 Pheonyte
Pheonyte's picture

It seemed to me that the entire point of [policy X] was really more of about getting "votes" than actually [stated goal Y].

That's true for all values of X and Y.

Thu, 01/30/2014 - 23:22 | 4386588 Boris Alatovkrap
Boris Alatovkrap's picture

Is funny pantomime where member of political class is pretend solve problem at teleprompter.

Thu, 01/30/2014 - 23:33 | 4386609 akak
akak's picture

Is more funny that most in working poor class believe lies of political class that they are solve problems when in fact they are create problems.

Thu, 01/30/2014 - 23:33 | 4386613 sixsigma cygnus...
sixsigma cygnusatratus's picture

When people start to figure out that the teleprompter is the brains behind the whole operation, that teleprompter will be sent to Libya as ambassador.

Thu, 01/30/2014 - 23:33 | 4386612 The Vineyard
The Vineyard's picture

I live from paycheck to paycheck.  My retirement plan?  I'm going to be a hobo in Miami.  Perhaps I'll live in a school bus down by the Everglades.  If you see my sorry ass. please toss me a sandwich.

Fri, 01/31/2014 - 01:22 | 4386905 James
James's picture

Vineyard, if you can handle Tampa i'll find you a roof

Fri, 01/31/2014 - 04:20 | 4387039 zhandax
zhandax's picture

Vinyard, when I moved to Miami in 1981 (hey, 5 years of college drunkenness will lead you to do things like that), one of the people who I still remember is Joey (me makee de hat).  He was almost certainly a Marielito, but derived an obvious pleasure from meeting new people and could weave hats from palm fronds quickly and on demand.  He worked the beaches and on a good day, probably cleared $200 cash, tax free.

Fri, 01/31/2014 - 08:56 | 4387304 onewayticket2
onewayticket2's picture

Try California....or better yet, Massachusetts....living free for over a decade with free healthcare, shelter, food, telephone and legal fees has been effortless for obama's Aunt Zutuni....and she's illegal.  just think of the spoils if you're a citizen.

Fri, 01/31/2014 - 11:48 | 4388028 Kobe Beef
Kobe Beef's picture

No spoils for citizens!!! Ever!!!

Thu, 01/30/2014 - 23:37 | 4386622 Oh regional Indian
Oh regional Indian's picture

Got to hand it to the thieves of Mall Street though. MyRA sounds cheesy to us, to the target audience, this is probably chosen for maximum impact.

I wonder (as I have only read of it here) as to how it is being spoken...MyArrrAye? Or My RA, sun god supreme....

Even a stoner on a bad acid trip could not have come up with this farce though.

Where is the NOT IN OUR NAME energy? 10% of annual MIC will cure all america's ills. In fact, even here in India.

tch.....

So, did you hear about the time the armadildo met a fleshlight?

ori

Fri, 01/31/2014 - 01:50 | 4386939 EscapingProgress
EscapingProgress's picture

Oh c'mon now, you don't actually believe votes are counted do you? The purpose of MyRA is to funnel muppet money into the treasury market in an attempt to make up for the reduction in Fed purchases and keep treasury yields down. Elections are decided months, if not years, in advance.

Fri, 01/31/2014 - 07:10 | 4387150 mvsjcl
mvsjcl's picture

It's where confiscated money will end up.

 

"Look! We're not stealing your money. See! We're putting it right here, and we'll give it back to you later when you need it!"

Fri, 01/31/2014 - 09:57 | 4387477 andrewp111
andrewp111's picture

At a 15K account limit, the amounts are too small for the Treasury to spend 10 minutes thiniking about. Even ordinary Savings Bonds are orders of magnitude larger. No, this is designed to funnel muppet money into Wall Street. Once you reach 15K, they will send you ads to transfer your account.

Fri, 01/31/2014 - 05:28 | 4387086 stant
stant's picture

sounds wonderfull to me, wheres the web site to sign up?

Thu, 01/30/2014 - 23:27 | 4386577 socalbeach
socalbeach's picture

Decent article on MyRAs by Daniel Amerman.

Who Most Benefits From MyRAs: Savers Or The US Treasury?

"We will also take a look at the potentially extraordinary advantages for the United States government when savers choose MyRA accounts. Which may raise the question about whether our seemingly benevolent government is truly attempting to help "close the income and wealth gap", or whether it is instead targeting what is generally the least financially-educated portion of society, for the direct financial benefit of the United States government..."

In my opinion it's different than investing in a Ponzi scheme, because with a Ponzi scheme there's at least a chance you can make money if you get out early.  With MyRA you're guaranteed to lose as long as the inflation rate is greater than interest rate MyRA pays (1.5%/year).

 

Fri, 01/31/2014 - 02:51 | 4386982 LMAOLORI
LMAOLORI's picture

 

 

There's so many things to dislike about FEDra....

 

WARNING Protect Your Savings Stay Away from Obama's New MyRA Program

snip...

 

" And it is going to be run by a crony Wall Street firm. A private-sector money management firm is going to be chosen by the Treasury to run the program.

Think about this.

Do you really want to place your money in the hands of an Obama-Lloyd Blankfein type money management team?"

Fri, 01/31/2014 - 04:42 | 4387057 zhandax
zhandax's picture

Hey, with the ability to freely traffic money in and out of the account, and the present status-quo unable to do anything without telegraphing it beforehand, it may be a viable new savings vehicle (at least better than what is available from any other savings vehicle ((not to be confused with investment or long-term wealth accumulation))).  FON (fuck o'douchebag now) accounts could be used to accumulate funds for metals purchase; and drawing down the account periodically should keep any withdrawal penalties from accruing.  -Probably /sarc; not sure I trust zero with my garbage, but unintended consequences have, on occasion, worked in favor of the taxpayer, and zero is so desperate this sounds ripe for the plucking-

Fri, 01/31/2014 - 12:50 | 4388307 LMAOLORI
LMAOLORI's picture

 

 

I'm pretty sure they will find a way to close down anything that would benefit the regular Joe. It seems to me insiders always come out on top. Eventually the powerful elites will turn the entire world into a cashless society and they will really use that hammer and sickle then.

Sat, 02/01/2014 - 04:26 | 4390853 -NaN-
-NaN-'s picture

Aaaahaaaa!  Now we all know what Corzine is up to these days. I am sure Oh-bummer lets him hang out in the White House basement hot tub, so he can learn from the best.

Fri, 01/31/2014 - 10:33 | 4387643 andrewp111
andrewp111's picture

Neither Savers or the UST will benefit from MyRA. It is designed to get non-savers to amass 15K, and then roll that cash into some favored Wall Street firm, so that the money can then be lost in risky investments and pad some Bankster's year end bonus.

It is just like what happened in the 2000s. Poor people who owned their homes were suckered by slick Banksters into borrowing against those houses, and then they lost the houses to foreclosure after the bubble burst. Banzai7's cartoon showing the pig that says "we want your savings" says it all.

Thu, 01/30/2014 - 23:23 | 4386585 Goldilocks
Goldilocks's picture

"He who fights with monsters should look to it that he himself does not become a monster. And when you gaze long into an abyss the abyss also gazes into you." - Friedrich Nietzsche

Thu, 01/30/2014 - 23:23 | 4386586 NoDebt
NoDebt's picture

Oh, my God.  Do we really have "experts" talking about the plusses and minuses of a program that doesn't exist yet?  Straight from SOTU speech to tax law in 24 hours?  

NOBODY KNOWS THE DETAILS OF THIS PROGRAM BECAUSE THE REGULATIONS HAVEN'T BEEN WRITTEN YET.

And given the track record of this administration, I expect reality to be quite different from the promise.

Fri, 01/31/2014 - 01:02 | 4386857 snr-moment
snr-moment's picture

You're right. No doubt it'll be more equitable.  Perhaps 50% proceeds to go into bitcoin.

Fri, 01/31/2014 - 05:40 | 4387090 CuttingEdge
CuttingEdge's picture

"NOBODY KNOWS THE DETAILS OF THIS PROGRAM BECAUSE THE REGULATIONS HAVEN'T BEEN WRITTEN YET."

Sounds a bit like:

Congress had to pass OFuckwitCare to see what was in the bill.

Obama is a snake-oil cuntsaleman. Fact.

Problem is, the wider population is too fucking stupid to see it. Maybe those health policy cancellations/premium increases may have assisted a few with enlightenment (cue Belushi in the church in BB), but for the rest?

 

God save the USA, cos it sure as hell needs divine intervention with this Kenyan teleprompter-inspired fuck-up in charge for 3 more years...

Thu, 01/30/2014 - 23:26 | 4386596 Colonel Klink
Colonel Klink's picture

Obama does nothing to help the middle class.  Only redistribute wealth to the poor (FSA) and the rich.  Everything he's doing is to break the back of the middle class (white).  Eric "cock" Holder prosecutes hate crimes only one way, and at the same time ignores the white collar crime that keeps them in power.

MyRAs are not about helping anyone but government and Fraud street.

Thu, 01/30/2014 - 23:37 | 4386621 fonzannoon
fonzannoon's picture

I just realized where this is all going. You heard this here first. This is going to an eventual government backed variable annuity with living benefits. Monies will be split up between UST's and SPY with a guaranteed lifetime withdrawal % based on age at time of withdrawal. This will ensure that UST's and SPY have constant inflows and much like an insurance company, the .gov will have their actuaries structure it so they are always winning while also raking the pot.

checkmate motherfuckers, I figured it out.

Thu, 01/30/2014 - 23:44 | 4386645 Grande Tetons
Grande Tetons's picture

Could be...if the average pull out age is at the high side. Like 70 or 75...or fucking means tested. I figure it would be easier if they just made it the law that people start smoking non filtered cigarettes and to have lots of unprotected sex with Hatian immigrants. 

Thu, 01/30/2014 - 23:47 | 4386666 fonzannoon
fonzannoon's picture

i know those variable annuities well. people delay withdrawals as late as possible to build up the withdrawal. then at 75 when they can't work that part time job anymore they start taking money out, get 5 years out of it, and drop dead.

Thu, 01/30/2014 - 23:50 | 4386676 Grande Tetons
Grande Tetons's picture

I here you. Could be like the good ole days for .gov when the AARP crowd kicked the bucket on time.

Fri, 01/31/2014 - 05:47 | 4387097 zhandax
zhandax's picture

You have to read the contract (and understand it).  Equitable had a variable contract around 1990 (in one variation), that, if you allowed it to lapse and then re-instated it, allowed you to freely traffic moneys into and out of the contract with no penalties.  Probably screw-ups like this all over the board,   But the big downfall of mankind; you have to know what you are buying.

Fri, 01/31/2014 - 07:49 | 4387193 Henry Chinaski
Henry Chinaski's picture

AARP crowd kicked the bucket on time.

Oh they will thanks to obamacare.  TPTB aren't stupid, just evil.  Obama is merely their tool. 

Thu, 01/30/2014 - 23:48 | 4386665 NoDebt
NoDebt's picture

Good job, Fonz.  I only beat you to it by a few minutes- see below.

When the Government is your only tool, everything starts to look like a governent program.

Thu, 01/30/2014 - 23:51 | 4386680 fonzannoon
fonzannoon's picture

in actuality we have all been saying this for years. i know i have. But everyone on here thinks we need some major market crash. It seems more likely all we really need is moar Zirp, which is assured.

Fri, 01/31/2014 - 00:01 | 4386705 Grande Tetons
Grande Tetons's picture

Curious...do you see this putting all IRAs at peril? Call it mandatory help and assurance if you will. 

Fri, 01/31/2014 - 00:09 | 4386728 fonzannoon
fonzannoon's picture

No, I don't. I see this differently because I don't believe a massive market crash is going to play a role, unless they decide to go for the headshot. so as a 36 year old I will keep my IRA and buy facefart and twitter and DDD and attempt to kill it. when i'm 55 and ready for my flomax commercial retirement guarantee i will roll some of the funds into my .gov backed annuity in SPY/UST's and let that grow at an average rate of 8% a year until I want my income at 65.

If there is anyone at risk here it's the insurance companies who will lose this annuity business. but many of them have already gotten creamed so bad by zirp they have raised their fees so high and lowered their benefits that it's only a matter of time before they have no inflows anyway. That is the handoff to .gov. not the IRA's which will continue to be used by the young and the wealthy who don't need the guarantee.

whaddaya think?

Fri, 01/31/2014 - 00:22 | 4386763 Grande Tetons
Grande Tetons's picture

I see your point on the life business side. Long story.  However, the young and the healthy never needed Obamacare either....and look where that is heading and who it is benefiting...insurance companies. 

Remember John Hancock Financial? I think they are owned by Manulife out of Canada. Look what these fuckers are pimping.

http://www.vrsp.com/index.html 

No, I think we all need the guarantee whether we need it or not.  Akin to paying into SS when you could do better by investing for yourself sort of idea. 

Fonz, to be honest....I am perplexed...and I think this will take much ruminating to get even close to understanding the end game.  

 

Fri, 01/31/2014 - 00:21 | 4386765 NoDebt
NoDebt's picture

You're assuming they're going to play fair.  They won't.  When it goes down, when they get desperate, they'll come for everything.  Regardless of where it is, unless they can't track it.  Tax-advantaged accounts that wouldn't even exist without the government allowing them in the first place (IRAs, 401Ks, 457s, MyRAs, etc.) will be first, since they can change their mind about them legally with little trouble and know exactly where they are.  

Then non-qualified accounts.  Then paper certificates of any kind.  Keep tracking down from there and you know where you end up.

Fri, 01/31/2014 - 00:25 | 4386781 fonzannoon
fonzannoon's picture

my guess is muni's get partially taxed first, then Roth's... easier sell to the public. But yeah, in time they will grab for it all. 

Fri, 01/31/2014 - 00:31 | 4386794 NoDebt
NoDebt's picture

The order will matter little when it does down.  Wherever it is when the screws start to tighten, they will be able to track it from that point forward.  

Fri, 01/31/2014 - 00:47 | 4386832 Grande Tetons
Grande Tetons's picture

Thanks, No Debt, Fonz and Greenskeeper. I have read your posts and enjoyed the shared knowledge. Until tomorrow. 

Fri, 01/31/2014 - 01:21 | 4386906 Professorlocknload
Professorlocknload's picture

 MyRA looks to me like the founding of a sovereign wealth fund, to be wielded around by con'gress for the purchase of influence.

Fri, 01/31/2014 - 10:18 | 4387588 The Duke of Skiatook
The Duke of Skiatook's picture

As I have asked many times before:  How long will it be before your favorite sneaky uncle Sam creeps into your bedroom late one night with a raging hard on for a piece of your 401(k)'s ass?

Fri, 01/31/2014 - 07:27 | 4387174 negative rates
negative rates's picture

That's fantasy world thinking, you don't have the 55, or anywhere near it, and you aint prepen either sucker.

Fri, 01/31/2014 - 13:17 | 4388411 PlausibleDenial
PlausibleDenial's picture

@Fonz;  A couple of things.  Part of the saving for retirement myth is that you will be in a lower tax bracket at retirement.  Just does not occur for most people particularly if you are successful.  Also, I just don't understand why folks save pre-tax retirement funds (except Roths) when we are in the lowest marginal tax brackets.  Historically, the average highest marginal tax bracket is 59%.  So, if the highest marginal now is 39% why would you defer your taxes?  Moreover, for many years since 1913, the highest marginal brackets have been well into the 70% levels.  I don't think pre-tax savings makes sense until we are at least back to those levels.  Then, you might be lucky enough (doubtful) to be in a lower tax bracket at retirement age.

Most qualified plans should be recharacterized as regulated plans. 

Fri, 01/31/2014 - 00:02 | 4386712 NoDebt
NoDebt's picture

That's the maddening part of talkign about this in a meaningful way.  It's either brand new or old as the hills, depending on where you drop the bar to start discussions.

Fri, 01/31/2014 - 07:28 | 4387176 negative rates
negative rates's picture

I see your maddening, and raise you a bar.

Fri, 01/31/2014 - 00:13 | 4386746 Greenskeeper_Carl
Greenskeeper_Carl's picture

Ya you got me there. I have known this was a inevitable for a long time, but I have always thought it would come on the heals of a big time market crash, 'forcing' the govt to come in and protect us poor peasants from market volatility and the predations of Wall Street by forcing us, at gun point, to invest a % of our money in the 'safety and security' of us treasury bonds, which allows them borrow (steal) trillions from the American people in a way that not one person in a thousand will understand. Quite brilliant, in a way. But what you have been saying could happen without any kind of crash. Either way, it's probably coming one way or another.

Fri, 01/31/2014 - 07:55 | 4387198 Henry Chinaski
Henry Chinaski's picture

There are so many means, but only one inevitable end: wealth confiscation.  Bitchez!

Fri, 01/31/2014 - 07:56 | 4387197 RSloane
RSloane's picture

I still doubt there will ever be a major market crash. Death by a 1000 papercuts is more like it.

Fri, 01/31/2014 - 07:02 | 4387142 RSloane
RSloane's picture

Exactly right Fonz. I was thinking the very same thing. Like Obamacare, this is a program for gov't and their handlers and has little to do with the welfare of the public. They will do absolutely anything to get their hands on private money.

Fri, 01/31/2014 - 13:09 | 4388380 Hongcha
Hongcha's picture

That is chilling Fonz.  Yes, as long as we put every detail of our lives into a digitized format they will continue to be able to digitally pinch off as much fleece, skin and occasional muscle tissue as they can get away with.

There is only one way out.

Fri, 01/31/2014 - 00:32 | 4386797 Tim_
Tim_'s picture

Presidential Retirement Benefits

"Former presidents are offered a taxable lifetime pension equal to the annual rate of basic pay for the heads of executive branch departments, like the Cabinet Secretaries. This amount is set annually by Congress and is currently (in 2011) $199,700 per year."

"For the first 7 months, beginning one month before the January 20 inauguration, former presidents get transition funding to help them transition back into private life."

"The President’s FY2013 budget requested $8.95 million for PTA-authorized purposes during the 2012-2013 presidential transition. Of this total, $1 million was requested for briefings and related transition services for incoming personnel associated with the new administration. These recommendations were endorsed by Congress and included in the Continuing Appropriations Resolution of September 28, 2012" (Presidential Transition Act: Provisions and Funding, p. 3).

"Six months after a president leaves office, he or she gets funds for an office staff. During the first 30 months after the leaving office, the former president gets a maximum of $150,000 per year for this purpose. Thereafter, the Former Presidents Act stipulates that the aggregate rates of staff compensation for a former President cannot exceed $96,000 annually."

"Under a law enacted in 1968, the GSA makes funds available to former presidents and no more than two of his or her staff members for travel and related expenses."

"With the enactment of the Former Presidents Protection Act of 2012 (H.R. 6620), on Jan. 10, 2013, former presidents and their spouses receive Secret Service protection for their lifetimes."

"Former Presidents and their spouses, widows, and minor children are entitled to treatment in military hospitals."

"Former presidents are traditionally granted state funerals with military honors."

Thu, 01/30/2014 - 23:31 | 4386600 akak
akak's picture

Dear Lance Roberts,

"American's" what?

Please learn the difference between the possessive "s" (with apostrophe) and the plural "s" (without the apostrophe).

Really, its so basic an error that I am embarrassed for your mistake's.

Thu, 01/30/2014 - 23:38 | 4386620 Grande Tetons
Grande Tetons's picture

I am more embarrassed for him in the sense that he does not see the big picture. This is NOT about votes...it is about RAMMING another mechanism of theft down the gullet of the American people. Obama is the snake oil salesman...he is NOT the manufacturer of said snake oil. 

Nixon would be proud. 

Thu, 01/30/2014 - 23:43 | 4386650 NoDebt
NoDebt's picture

You're pissing into the wind, my friend.  We're just going to end up as the crusty old bastards who pine for the days when anyone who's graduated elementary school knows the difference between Their, They're and There.

It exists now only as a generational marker, I'm afraid.  The fact that you complained about it only indicates your approximate age.

The fact that I used all contractions properly throughout this post indicates I'm probably of a similar generation to you.

Beyond that.... nobody cares any more.

Fri, 01/31/2014 - 00:09 | 4386715 akak
akak's picture

I care not.  I shall piss into the wind (and into the faces of the ignorant) until the day that I die.

And it DOES matter, as language is a tool, and like any tool, its misuse leads to errors and mistakes, in these particular cases to hindered ease of reading and often hindered comprehension itself.

Fri, 01/31/2014 - 00:13 | 4386737 NoDebt
NoDebt's picture

I would sit in a bunker with you at the end of the world and be glad for the company, my friend.

You're right, of course.  It's not me who's going to argue with you.  It's everyone else who has no idea what the fuck we're even talking about.

Fri, 01/31/2014 - 00:17 | 4386754 akak
akak's picture

That is only their loss, of course.

I am more and more reminded of Fahrenheit 451 with every passing year; remember, books only finally became illegal in that dystopia after books, and reading itself, had been given up by the increasingly adolescent and sensationalism-seeking masses, all trends that I see around me today.

Fri, 01/31/2014 - 00:22 | 4386771 NoDebt
NoDebt's picture

If our generation missed anything, it was that 451 and other seminal works were not warnings, they were instruction manuals.

Fri, 01/31/2014 - 05:59 | 4387106 Serenity Now
Serenity Now's picture

That is such a good book.  1984, Fahrenheit 451, and Brave New World should be read together.  They are the dystopian trifecta.

Re:  Fahrenheit 451

Montag (the last name of the main character, Guy) is the name of an old paper company.

Faber (the last name of the professor that Guy meets) is a brand of pencils.

Great books.

Fri, 01/31/2014 - 08:58 | 4387308 Disenchanted
Disenchanted's picture

Add in We and The Iron Heel

Fri, 01/31/2014 - 09:14 | 4387359 wearef_ckedwith...
wearef_ckedwithnohope's picture

It is also about the QE taper.  They need someone to make up for the cutting back of FED monthly purchases of Treasuries.  So it's gonna be offered to the same group of people who have been unable to participate in the glories of QE - the stock market.  Lock 'em in at "at a less than true inflaction return" while trying to say it's all to help them achieve retirement security.

Fri, 01/31/2014 - 01:01 | 4386859 Miffed Microbio...
Miffed Microbiologist's picture

At this point books are not being banned but are being made superfluous and ignored. Reading is no longer extolled because it requires patience and an attention span greater than a gnat. Books are contemplative and require imagination and critical thinking. To me, we are approaching " This Perfect Day" rather than Fahrenheit 451, which is eminently more sinister IMHO.

Miffed;-)

Fri, 01/31/2014 - 00:24 | 4386770 Pheonyte
Pheonyte's picture

It's also unfortunate when the otherwise good point being made is undermined by the ungrammatical manner in which it's expressed.

Fri, 01/31/2014 - 02:25 | 4386957 Professorlocknload
Professorlocknload's picture

Not all here were afforded the opportunity to attend Ivy League institutions. Some had to learn lifes lessons on the street. This does not make them less wise in the ways of the world. Au Contraire, some might be wiser for it, just not as well respected by others who consider themselves a cut above. 

Old Irish toast "Dung heaps rise and castles fall, we are equal one and all."

Fri, 01/31/2014 - 04:35 | 4387062 Miffed Microbio...
Miffed Microbiologist's picture

I had a Mexican friend from Tijuana that was studying to be a PA. His English was quite poor but he had lots of drive to succeed in school and was working as a lab assistant/ phlebotomist. He pulled me and another work associate aside and begged us to correct his English. Sometimes our conversations took quite sometime because we were constantly correcting him. After 3 years his English was stellar and he thanked us both for making all the difference in getting his internship at UCLA. Amazing considering the difficultly getting an internship there on the first try.

The key is not taking it personally. We all can learn new things and improve ourselves no matter what our backgrounds are. It has nothing to do with wisdom. People should not demean others for lack of knowledge. People should not use ignorance as a badge of honor. Both cases are filled with emotions that are inappropriate and are hurtful to others.

Miffed;-)

Fri, 01/31/2014 - 06:07 | 4387109 Serenity Now
Serenity Now's picture

"It's also unfortunate when the otherwise good point being made is undermined by the ungrammatical manner in which it's expressed."

 

In other words, we don't talk good.  ;)

Fri, 01/31/2014 - 05:44 | 4387092 Serenity Now
Serenity Now's picture

Yes, language matters.  Words matter.  Definitions matter.  

I'm not a grammar nazi, but I hate to see words being used incorrectly (i.e., inflation).  I hate to see meaningless phrases (i.e., too big to fail) become part of our everyday language.  

Language IS A TOOL, and the Left has mastered how to use it against the rest of us.

Fri, 01/31/2014 - 07:35 | 4387179 negative rates
negative rates's picture

In more ways than one too, I had a talk with the women who designed the alphabet and dictionary, and she said it wasn't meant to be butchered in the ways in which you all have done to try to acquire power. And she hoped you would suffer greatly inside for doing so, they made a word for that and included it in the seven deadly sins catagory. It's called gluttony. 

Fri, 01/31/2014 - 07:29 | 4387177 negative rates
negative rates's picture

You better start counting the days then cause it right around zee corner.

Fri, 01/31/2014 - 06:59 | 4387140 RSloane
RSloane's picture

Recently a school in New York cancelled their gifted program because not enough minorities qualified for it and the teachers 'felt' that was unfair. Their gifted students lost their program ad were ploughed back into the mainstream classes where not enough of them can read "they're" or "their" let alone tell the difference.

Progress forward!

Fri, 01/31/2014 - 09:26 | 4387395 Winston Churchill
Winston Churchill's picture

AKAK

Please learn English.

The poisition of said apostrophe denotes possesive, or plural.

After the 's' is possesive.

A least be a correct grammar nazi., if you need to be one.

Fri, 01/31/2014 - 13:05 | 4388365 PlausibleDenial
PlausibleDenial's picture

WC, learn to spell before you cast dispersions:)

Thu, 01/30/2014 - 23:28 | 4386602 Greenskeeper_Carl
Greenskeeper_Carl's picture

A highly doubt anyone who makes almost 200k a year can't find anything better to do with ther money than this hair brained Ponzi scheme. Also, how does this even help the working poor, what used to be the middle class, when they are all paycheck to paycheck and have no money to invest anyway. What a farce

Thu, 01/30/2014 - 23:32 | 4386611 NoDebt
NoDebt's picture

This is the first step towards a "federal government bank for the people".  In short, it's a new control scheme being hatched.  If you're into centralized control of everything, this is right up your alley.

Thu, 01/30/2014 - 23:43 | 4386641 seek
seek's picture

Exactly! This is move to take over IRA/401K investment control -- and likely the groundwork to make such savings mandatory.

Thu, 01/30/2014 - 23:44 | 4386648 dexter_morgan
dexter_morgan's picture

sadly, very few have any clue about that, or at least don't seem to care

Thu, 01/30/2014 - 23:53 | 4386691 NoDebt
NoDebt's picture

Dex- this is both "brand new" and "as old as the hills".  My father told me 30 years ago this was how it was going to turn out.  Since I joined ZH it has been a topic of conversation on and off.  Now the first concrete step has actually been announced.

If you are surprised and think ANYTHING government does came out of the blue 2 minutes ago, it only means you already missed years of warning signs that were right in front of your eyes the whole time.

 

Fri, 01/31/2014 - 01:48 | 4386937 Professorlocknload
Professorlocknload's picture

First, Medicare, leading to Single Payer through ACA.

First the IRA account, leading to the Congress controlled Sovereign Wealth Fund, through MyRA.

First, the Patriot Act, leading to,,,

 

Fri, 01/31/2014 - 11:14 | 4387813 Kobe Beef
Kobe Beef's picture

A Police State to make the Stasi and GRU blush.

Fri, 01/31/2014 - 00:06 | 4386718 orez65
orez65's picture

You guys may be too young, but I remember when employers used to pressure employees to buy "US Saving Bonds".

Most people used to buy them, through a direct payroll deduction, and sell them a month later.

It was like a "float loan" to the Federal Government.

Unfortunately this time, the Federal Government's goal is the confiscation of all pension funds.

"If you like your pension plan, you can keep your pension plan". 

Fri, 01/31/2014 - 07:36 | 4387182 negative rates
negative rates's picture

It's not so much fun on the other side of the coin huh? Face is always in the dirt.

Thu, 01/30/2014 - 23:33 | 4386617 tmosley
tmosley's picture

Fuck all those stupid questions.  The real question is: "are the contributions pre-tax or post tax?"

If pre-tax, then the greatest tax loophole in the universe just opened up.

Thu, 01/30/2014 - 23:42 | 4386640 fonzannoon
fonzannoon's picture

it looks like contributions are pre tax but withdrawals are taxable but avoid early withdrawal penalty. so as the author said it is just a slightly higher paying savings account.

Fri, 01/31/2014 - 00:09 | 4386702 NoDebt
NoDebt's picture

Disagree, Fonz.  All the talk about "rolling" balances into Roth IRAs means it's clearly post-tax contributions.

The fact that .gov wants its tax money up-front, and in as large a quantity as possible, only serves to back this up.  (They'll change their mind later and double tax it anyway, obviously.)

I'm prepared to lay a Doc Engali/Kito-style ZH sandwich wager on this one.

Fri, 01/31/2014 - 00:16 | 4386743 fonzannoon
fonzannoon's picture

depends. I thought these plans were to be set up as pre tax  payroll deduction through employers who were not  currently offering a retirement plan (and the employer had the option to match, haha). if that is correct and the money goes into the plan pre tax the way I understood it then you have yourself a bet. Tmosley seems to be describing it as a plan where the money comes out pre tax and is withdrawn tax free. I disagree with that.

edit - Tmosley is not describing anything, just asking the question. No way .gov allows pre tax contributions and tax free withdrawals, and i'd bet a hell of a lot more than a sandwich on that.

Fri, 01/31/2014 - 00:27 | 4386779 NoDebt
NoDebt's picture

You got it.  Now you're thinking straight.

Fri, 01/31/2014 - 00:40 | 4386819 ebworthen
ebworthen's picture

"Tax free withdrawals."

ROFLMAO!!!

Thu, 01/30/2014 - 23:35 | 4386618 bidaskspread
bidaskspread's picture

Myra, a portal to by pass Congress. You want to give more handouts, raise the interest rates on Myra. The final tool to directly get funds to citizens bypassing Congress. Not popular before the election, raise the interest paid out. Put in a dollar get three out.

Fri, 01/31/2014 - 11:17 | 4387820 Kobe Beef
Kobe Beef's picture

Deck chairs on the Titanic. Fresh paint on the USSA Potemkin. The ponzi.. is.. dying.. from.. lack.. of demographic..inputs.

Thu, 01/30/2014 - 23:38 | 4386629 Georgia_Boy
Georgia_Boy's picture

Exactly ... this is NOT going to help the people who it is claimed to help, they are the same ones who blow up their retirement account as soon as they leave a job, fees or no fees. The Administration has to know this, but said anyway that you could withdraw your contributions at any time, tax free. Taken at face value it makes not a bit of sense. So what's the real reason for creating this?

Thu, 01/30/2014 - 23:40 | 4386636 seek
seek's picture

It's not about votes. It's a gateway. They've already laid out the plan.

The big clue was the mention of automatic IRA paycheck deductions. This is SS 2.0, first it'll be voluntary, and then it'll be mandatory.

Before you'd voluntarily contribute to your IRA and invest in whatever, and they need to force those investments into treasuries -- so this is the first stage of taking over the IRA/401K landscape. My guess is they'll even use stock market collapses that wipe out 401K/IRA valuations as a justification (hence the "no risk" marketing.)

The US government is jealous as hell that Japan was able to dump all their debt onto savers and wants the same game here. Of course, hardly anyone has savings and this is a desperate grab at straws, but it won't stop them from trying.

Thu, 01/30/2014 - 23:48 | 4386670 akak
akak's picture

Seek, that is an extremely cogent and insightful analysis.

And let's face it, the modern US federal government is NEVER going to propose any major new program, or an overhaul of any existing program, unless it benefits the federal government, whether financially or via accruing more power in federal clutches, or both.

Thu, 01/30/2014 - 23:58 | 4386697 fonzannoon
fonzannoon's picture

this plan goes absolutely nowhere until they move from bonds to a stock/bond combo. no one is sacraficing i-crap for 2%. 

going stock/bond combo assures a smooth ride up for stocks as well as a calm bond market

Fri, 01/31/2014 - 00:16 | 4386749 seek
seek's picture

Oh, they'll sacrifice it when it goes negative on them. I think you can count on massive MyRA marketing programs immediately after each stock market crash. 

I can see the ads now -- a copy of a 401K statement with a big red-highlighted loss ... with the tagline of "This wouldn't have happened if I'd only had MyRA!"

Fri, 01/31/2014 - 00:18 | 4386758 fonzannoon
fonzannoon's picture

maybe man. I think the stock market is way too much of a useful tooll

Fri, 01/31/2014 - 01:57 | 4386950 Professorlocknload
Professorlocknload's picture

And will these new "bonds" be put in the same "Lock Box" as Social Security? Will .gov end up "Matching" contributions in election years amongst "chosen communities?"

 

 

Fri, 01/31/2014 - 11:29 | 4387905 Kobe Beef
Kobe Beef's picture

It will last as long as the USSA military is useful for securing ownership of mineral, oil, and water rights for the corporate subsidiaries of the NWO. And as long as the USSA sec services devise ever-more penetrative means to craft the surveillance tech necessary to keep them in power.

Then? The USSA will not be worth funding. It will be globalized, and America will be just another 3rd world country. Whatever you render unto Caesar, do not expect to get it back.

Fri, 01/31/2014 - 03:21 | 4387015 tsuki
tsuki's picture

And in fourty years, MyRA will be an "entitlement" program, another give-away,  that needs to be "reformed" out of existence. 

Thu, 01/30/2014 - 23:43 | 4386646 Yenbot
Yenbot's picture

Myra, Lewinsky, I don't care what any of them ever decide to call anything ever again. I quit listening, caring, believing or complying years ago. Anything spewed by .gov is poison, a trap, and a parasitic extortion racket. Avoid at all costs.

Fri, 01/31/2014 - 10:58 | 4387753 RafterManFMJ
RafterManFMJ's picture

Preach it, Brother!!

Fri, 01/31/2014 - 11:39 | 4387961 Kobe Beef
Kobe Beef's picture

Amen. Happy August 24th!!

Fri, 01/31/2014 - 00:38 | 4386654 Goldilocks
Goldilocks's picture

Pink Floyd Another Brick In The Wall HQ lyrics subtitles
http://www.youtube.com/watch?v=1kbjXJqd2ps (5:37)

Thu, 01/30/2014 - 23:45 | 4386657 Seasmoke
Seasmoke's picture

I'm going TO put in $14,000 every two weeks and withdraw $14,000 tax free every other week.....they can keep the 1.8%

Fri, 01/31/2014 - 00:09 | 4386725 NoDebt
NoDebt's picture

.... Which is EXACTLY why I know this "program" is not at all as it's been advertised in the SOTU speech.  THERE IS NO PROGRAM YET.  It hasn't been written.  When it is, all this "expert" commentary we're getting thrown at us, a mere day after the speech, will be proven DEAD FUCKING WRONG in many critical aspects.

 

Fri, 01/31/2014 - 07:40 | 4387185 negative rates
negative rates's picture

Why couldn't he offer to match the contribution with an equal amount of gold dust? Trust me once, shame on you. Trust me twice, shame on me.

Thu, 01/30/2014 - 23:53 | 4386692 Seasmoke
Seasmoke's picture

I do understand now , why going to war is the easier choice, than trying to sell this ponzi bag of shit to the public. 

Fri, 01/31/2014 - 07:44 | 4387187 negative rates
negative rates's picture

Who the hell is sellin? It's a takers ponzi kept from the public. They got a PHD to take your money and then passed a law to make it "legal"? A prelude to the "we had to pass it so you could find out what's in it" mantra.

Fri, 01/31/2014 - 00:21 | 4386762 hound dog vigilante
hound dog vigilante's picture

 

 

MyRA is confirmation that Sinclair/others are dead right.  They've already re-written the laws to justify & sanction bank bail-in's (that's not your money in your account). And MyRA provides the framework and propaganda vehicle.  All that's needed now is an excuse... *insert crisis/war/emergency here*

Once they've scared the herd with a phoney (and completely predictable) crisis or war, the sheep will wake up some monday morning and old IRAs & 401k's will be new MyRA's filled with depreciating treasuries (after a haircut, of course). Straight-up confiscation & theft, in broad daylight.  And the remaining sheep will sit there and take it, as those with half-a-brain will be out of the system by then, methinks.

By the time this happens things will have gotten so bad that it will barely rank as news... 

Fri, 01/31/2014 - 11:44 | 4387986 Kobe Beef
Kobe Beef's picture

Too bad that Bin Laden guy got 'kilt'. Wonder which CIA contractor Central Casting will make the new monster. I'm betting it will be an Eastern European, Caucasus contractor. Brezinzski's chessboard demands it.

Fri, 01/31/2014 - 00:30 | 4386775 Andy Lewis
Andy Lewis's picture

self-deleted

Fri, 01/31/2014 - 00:32 | 4386792 El Vaquero
El Vaquero's picture

 

It seemed to me that the entire point of the MyRA was really more of about getting "votes" than actually helping middle class American's substantially change their retirement futures.

It seemed to me that they were a retirement account theft instrument. 

Fri, 01/31/2014 - 00:38 | 4386812 Atomizer
Atomizer's picture

Between amnesty, generating new taxpayer revenue, and baiting ObamaCare to fund a new ponzi scam. These fucker are shooting fast and furious guns into a barrel of fish. 

 

Fri, 01/31/2014 - 00:38 | 4386813 ebworthen
ebworthen's picture

Short version:  "To Serve Man"

"It's a cookbook!"

Fri, 01/31/2014 - 01:11 | 4386882 hesk
hesk's picture

No, There is more space dust on it. -Kudos

Fri, 01/31/2014 - 01:28 | 4386876 Hail Spode
Hail Spode's picture

   They are doing this to make another show-down on raising the debt ceiling politically impossible  http://arkansaswatch.blogspot.com/2014/01/myra-and-fool-me-twice.html

Fri, 01/31/2014 - 01:22 | 4386907 Goldilocks
Goldilocks's picture

Darth Sidious: [to Separatists] I am sending you my new apprentice, Darth Vader. He will... take care of you.

Fri, 01/31/2014 - 01:29 | 4386916 bonzo112358
bonzo112358's picture

Let's not forget if you would have bought myra before his speech you would be up 1400% in less than two trading days.

http://finance.yahoo.com/q?s=myra

Fri, 01/31/2014 - 01:41 | 4386931 Curt W
Curt W's picture

MYRA sounds like the ponzi scheme of the century

Fri, 01/31/2014 - 03:01 | 4386996 Drifter
Drifter's picture

Hey Capt Obvious, everybody figured out "MyRA" was a vote getting scam because everything he proposes is a vote getting scam.  Analysis not needed.

Fri, 01/31/2014 - 04:44 | 4387065 BeetleBailey
BeetleBailey's picture

FUCK Obama and FUCK anything he or his staff of motherfuckers come up with.

 

FUCK OFF ASSHOLE

Fri, 01/31/2014 - 09:08 | 4387338 d edwards
d edwards's picture

I have a feeling the response to MyRA will be decidedly underwhelming.

Fri, 01/31/2014 - 11:47 | 4388004 Kobe Beef
Kobe Beef's picture

As the author of the post points out: many Americans don't have jobs, and those that do, have no savings to put into the theft-vehicle.

Fri, 01/31/2014 - 08:21 | 4387234 Last of the Mid...
Last of the Middle Class's picture

I remember my father, who financed autos for 38 years at a local bank, telling me of a program the directors came up with. If a car note was say $200, they would make it $210 and open a smal savings account for the person with the extra $10. My dad's argument was if somone is making a $200 car payment then they can only afford one for $150 and are stretching for the rest. In actuality they can't afford $200 much less $210. Program died of course. Same thing here. It's not the savings, it's the lack of good paying jobs, barry. Get it? Also, if you croak, i'd bet money Myra becomes Barry & Moochelles RA pretty damn quick. another form of death tax which he surely didn't mention. Another thought, all retailers take federal monies through medicaid and medicaire programs for prescriptions. Why not just delcare Wally world and Target federal contractors and demand $10.10 per hour minimum for all?. The answer is that these peeps would show up in his office tell him to get his foot off that desk and explain to him in about 10 seconds that you're taking money from real people (donors) now and cut that shit out.

Fri, 01/31/2014 - 11:07 | 4387792 Papasmurf
Papasmurf's picture

Why would anyone extend more credit to the USG?

Fri, 01/31/2014 - 11:20 | 4387837 F em all but 6
F em all but 6's picture

Just in. Its all good!!! Just cashed in my stacks and bought into IRA treasuries.

Why? Have I lost by biscuits?? Hardley.

Hillary (HillBillary) has now proposed legislation that will be presented before Congress next week. Its called the Ron Brown  IRA Assurance and Muppet Withdraw Saftey Act. Under the ACT, all muppets that have pre tax dollars  diverted to MyIRA will be assured that they will be treated like Ron Brown during the withdraw process, whereby guaranteeing the saftey of government and said treasuries .

 

Moreover, on page 93,588 of the ACT, Secret service agents involved in the extrajudicial execution of Miriam Carey (http://www.wnd.com/2014/01/u-s-sued-over-unarmed-moms-d-c-killing/) "shall be re assigned to the newly created Administrative Withdraws Office within the Dept of Treasury".

And it gets better. On page 56,385, the proposed legislation contains language identified as the muppet mutually assured destruction guaruntee clause or MMADG. This clause authorizes the president, acting in his capacity as commander and chief, to use tactical thermo nuclear weapons at any "Branch Windraw Office" where, in the presidents opinion, any federal administrative agency has become or is in danger of becoming "overwhelmed by a any mob of muppets requesting or demanding anything in exchange for treasuries held in said accounts.

 

I feel soooo safe now.

 

Fri, 01/31/2014 - 17:03 | 4389285 Andy Lewis
Andy Lewis's picture

Little known fact about MyRA:  It's short for Myra Brecknridge.  It's a sex change operation!!!

Not that there's anything wrong with that.

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