Your Questions About Stock Market Is A Ponzi Scheme

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Richard asks…

Why do we need social security?

Why do we need it? I mean the fund that are put into the social security fund do not gain any real interest. You could put the money in a drawer for 50 years and it would be worth as much as if you put it into social security. The system in built on the hope that the next generation will be bigger than the last which makes it very similar to a Ponzi scheme. Eventually it will collapse if our population growth goes negative or near negative like Europe. I mean it helps old people now but what about the people in the future. The fund is already out of money and has been going into negative territory since 2011. Do we just pray it holds up until we are dead and say fuck future Americans?

Justin answers:

You are right that SS is similar to a Ponzi scheme. However, it would work if Congress could keep its cotton-picking hands off the fund. Instead, they regard it as a source for pet projects that are not in the budget.

The trouble is that we can’t afford to stop it. Bush’s brilliant idea to allow people to invest the money that would have been taken out in the stock market would have dried up the supply for us old fogies who depend on it for our daily expenses. Further, a stock market crash would have wiped out the retirement funds for the next batch of retirees. We can thank Bush for that too.

Yes, SS does not draw much interest. Neither does my savings account. What you have to do is to plan on a mix of places to put your money. When you are young, you can afford to gamble a bit on high-risk investments. As you age, you need to switch to more conservative stocks and bonds. A tip for you, bought with a big chunk of my retirement funds: when your broker recommends a stock that his firm is pushing, run the other way. On the other hand, my investment in a utility stock (conservative and well-managed) was enough to let me buy a house and mini-farm a few years later.

Robert asks…

Have the billionaire elites been running a ponzi scheme with the federal reserve?

billionaire Buffett says stocks will go a lot higher
http://finance.yahoo.com/news/warren-buffett-stocks-lot-higher-104158450.html
Fed chairman said, “federal reserve still buying $85 billion of mortgage backed securities and bonds” (Doesn’t this push up stock prices of companies that billionaires own, so that they don’t lose money on their bad investments and even makes their investmartificiallycally increase in price?)
Gee, isn’t that a ponzi scheme?
http://www.bloomberg.com/news/2013-03-20/fed-keeps-85-billion-pace-of-bond-buying-as-job-market-improves.html
Billionaire Buffet backs Obama and he owns a huge stake in BAC. Obama likes bailing out big banks where millionaires and billionaires have their money invested.
http://www.reuters.com/article/2010/11/17/us-obama-buffet-idUSTRE6AG4MU20101117
http://abcnews.go.com/blogs/politics/2011/09/warren-buffetts-rule-give-big-to-get-obama-re-elected/
Billionaire Buffet is a liberal and endorsed Obama and Senator Clinton.

Billionaire Oprah Winfrey is a liberal and endorsed Obama
http://en.wikipedia.org/wiki/Oprah_Winfrey’s_endorsement_of_Barack_Obama
Billionaire Bill Gates is a liberal and backed Obama
http://www.cbsnews.com/8301-503544_162-20025626-503544.html
Billionaire George Soros is a liberal and backed Obama
http://dealbook.nytimes.com/2007/01/27/george-soros-backs-obama-but-hedges-his-bets/
Obama calls billionaire Warren Buffet for advice
http://thehill.com/blogs/on-the-money/801-economy/177801-obama-calls-buffett-ford-ceo-for-jobs-advice
Billionaire Buffet’s Berkshire profits double
http://www.reuters.com/article/2012/05/04/us-berkshire-idUSBRE8431MT20120504

Justin answers:

Of course. Why should a nation with a constitutional right to issue it’s own currency borrow banknotes at interest?

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