Or, try this one.

Posted on: November 9, 2017 at 19:11:18 CT

America’s Silent Crisis
By Zach Scheidt

I ran into some disturbing news not long ago. News that makes me both angry and perplexed. And it has to do with America’s pensions.

But here’s why it’s so important — even if you don’t have a pension:

Your tax bill could explode as governments around the country seek to bail out insolvent pension plans. And you know how much politicians like to use your tax money to bail out some constituent. They like to prove their “compassion” with your money!

And frankly, the disturbing news I recently discovered could wreck your retirement plans.

All because some bozos on Wall Street are completely inept at investment management. Actually, I’m not sure if it’s incompetence… or sheer laziness. But frankly, it really doesn’t matter.

What matters is that millions of retirees are going to wake up one day and realize that their pension fund payments stopped coming. At the same time, tens of millions of retirees are going to wake up to a market calamity.

And it all ties back to the miserable job U.S. pension fund managers are doing.

Let me explain…

As you know, we’re currently in a long-term bull market for stocks. Ever since the market bottomed following the financial crisis, stocks have been moving steadily higher. The current bull market is one of the longest-standing bull markets in history, now approaching eight straight years of advances.

In fact, I read where this is currently the third-longest bull market in modern history.

You would think that pension funds would be benefiting from this extreme bull market, right? After all, we know that there is a pension crisis in the U.S., with an estimated $414 billion shortfall in what corporations need to be able to pay retirees.

But instead of investing in the stock market, allowing strong returns to make up pension shortfalls, pension fund managers have been underweighting U.S. stocks.

Regardless of whether the market is in a Fed-inflated bubble, no one can deny that it’s been an impressive run. And pension plans are missing the boat.

You see, when the financial crisis hit, pension funds reduced their exposure to stocks to the lowest level since the 1960s. Ironically, this is the exact time that pension funds should have been increasing their exposure to stocks!

Over the next eight years, not much changed. As the market plowed steadily higher, pension fund managers kept their portfolios conservative — allocating capital to things like Treasury bonds and “investment-grade” corporate bonds that paid next to nothing.

Remember, this is an eight-year period with interest rates at or near zero percent! What a horrible time to be invested in bonds!

So during one of the greatest bull markets in history, pension fund managers have put their investors’ capital on the sidelines, missing out on huge potential gains and investing in bonds that pay next to nothing in interest.

Can you see why I’m so angry?

But if you somehow think your Social Security retirement package is any better, think again. The Social Security trust fund has zero exposure to the current bull market. Instead, the fund invests in U.S. Treasury bonds. The very same bonds that are paying next to nothing in interest.

According to research firm Nolo, the Social Security trust fund will run out of money in 2035. That’s less than 20 years from today.

It’s unclear what will happen to Social Security payments at this point, but there’s a good chance your benefit checks will be much lower than what you’ve been promised.

And even if they’re not technically lower, you could still be getting ripped off through inflation…

The fact is that you’re being lied to. That’s the sad fact when it comes to government data on inflation. The phrase “lies, damned lies, and statistics” may have been popularized by Mark Twain, but the concept is still every bit as vibrant when it comes to current economic measurements.

Unfortunately, those “damned lies and statistics” are likely cutting into the retirement payments you currently receive, or expect to receive in the future…

This year, the Social Security Administration graciously gave seniors a 0.3% Cost of Living Adjustment (or “COLA”). In other words, Retirees who collect monthly Social Security payments, were treated to a miniscule raise to cover higher living expenses.

As you may know, the low adjustment is based primarily on the government’s measures of inflation.

Which are a joke!

You see, the labor department’s “Consumer-Price Index” is designed to measure costs for consumers, and tell us if inflation is rising. A rising CPI indicates that it takes more dollars to pay for goods and services. And if the CPI is steady, it means that prices are not rising and inflation is not a problem.

Of course, like most statistics, the CPI can be manipulated to tell you whatever you want to hear. And in this case, the government wants you to hear that inflation is tame.

That way, they don’t have to increase Social Security payments
That way, the Fed can justify juicing the economy with lower interest rates
That way, politicians can gloss over the rising costs of living for seniors, claiming that “inflation is not a problem”

In short, the Cost of Living Adjustment calculation makes a mockery out of the U.S. program that is supposed to provide retirement income for U.S. workers.