Mr. Bush, Meet Mr. Bust
The Christian Science Monitor's David R. Francis examines the ups and downs of the stock market and how questions we should ask about private accounts in the Social Security debate.
"The road to prosperity, Wall Street has long maintained, is paved with investments in stocks. President Bush takes a similar position in urging private accounts as part of Social Security."
"Stocks have averaged an annual return of 6 percent above bond yields since the 1920s. No wonder roughly half the households in the United States have invested money in stocks, either directly or through a retirement account.
There's a catch, though. Stock markets don't hit the average each year. Performance runs in streaks: Many strong years can be followed by many lean ones. This repetitive pattern has mystified many market analysts. So young Americans, contemplating Mr. Bush's proposal to replace a portion of Social Security with an investment component, may have to factor in this market cycle, not just their age, when planning a retirement date."
Full article HERE
"The road to prosperity, Wall Street has long maintained, is paved with investments in stocks. President Bush takes a similar position in urging private accounts as part of Social Security."
"Stocks have averaged an annual return of 6 percent above bond yields since the 1920s. No wonder roughly half the households in the United States have invested money in stocks, either directly or through a retirement account.
There's a catch, though. Stock markets don't hit the average each year. Performance runs in streaks: Many strong years can be followed by many lean ones. This repetitive pattern has mystified many market analysts. So young Americans, contemplating Mr. Bush's proposal to replace a portion of Social Security with an investment component, may have to factor in this market cycle, not just their age, when planning a retirement date."
Full article HERE
2 Comments:
This compelling analysis suggests that the total benefits predicted by the Social Security Calculator in the post below are overly optimistic! Triple-billed for much less benefit! 3X--
I think we should expect the Bush administration's facts and planning for Social Security private accounts to be about as reliable as its facts and planning for the War in Iraq. That is to say, almost totally duplicitous and wrongheaded.
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