Cameron Murray — Future of health & retirement is public, not private

For the free market ideologue who hates big government, our current situation of small government using its powers of taxation and compulsion to force people into a situation of “private taxation” should be even crazier than the socialist view of big government funding and delivering health and retirement schemes. Not only is there no clear ideological reason for these markets, they suffer from a number of fundamental economic problems that make them rather unsuitable for provision in a private market.… 

Apart from these problems, the apparent economic rational of having private insurance in these markets to reduce public debt makes no sense, even from an economic perspective. It is just an accounting trick. Economics teaches us that real resources are what constrains our productive output, not the balance sheet of different organisations. This is all the more obvious because the government is using its power to make contributions to these private insurance schemes compulsory, making them no different from taxation anyway.…

Fresh Economic Thinking
Future of health & retirement is public, not private
Cameron K. Murray

Here's why bull market in stocks and economic expansion guaranteed for next 20 years

There's only one statistic that you need to know to in order to understand what the outlook is for the economy and the stock market for the next 20 years and it's not how big the deficit is,

It's the fact that for the next 20 years 10,000 baby-boomers PER DAY will be retiring and becoming eligible to receive Social Security, Medicare and Medicaid.

Those problems are already 42% of annual Federal spending. ($1.8 trillion out of $4.3 trillion.) However, they're just going to continue to grow and grow and grow for the next 20 years.

You know what that is? It's government guaranteed income support. Just like what they're proposing in Switzerland only maybe half. Still, it's something and in the aggregate, when you consider the numbers--tens of millions of people--it's a massive and ongoing fiscal transfer to the economy.

This is why this recovery has lasted longer without a recession than anyone predicted (other than us, here). And it's why stocks keep going up.

With those kind of guaranteed flows the companies in the S&P 500 can ALWAYS squeeze out their trillion and a half or trillion eight of earnings.

Bull market...next 20 years.

FRBSF — Global Aging: More Headwinds for U.S. Stocks?

The boomers have had a marked influence economically as they passed through the stages of life. No reason to think that won't happen as they retire and start to draw on accumulated savings. Will this be offset?

The retirement of the baby boomers is expected to severely cut U.S. stock values in the near future. Since population aging is widespread across the world’s largest countries, this raises the question of whether global aging could adversely affect the U.S. equity market even further. However, the strong relationship between demographics and equity values in this country do not hold true in other industrial countries. This suggests that global aging is unlikely to create additional headwinds for U.S. equities.

FRBSF Economic Letter
Global Aging: More Headwinds for U.S. Stocks?
Zheng Liu, Mark M. Spiegel, and Bing Wang

80 is the new 68

Not too long ago a study revealed that most people define old age as 68. What a difference a few years make. This week a new study found that old age really doesn't begin until 80. 

The study, commissioned by comparison website PayingTooMuch.com, asked 2,000 Britons over 40 what they considered old. The average answer -- 80 -- was nearly 20 years later than what previous generations might have responded. Those behind the study say the change in attitude is due in large part to delayed retirement, more active lifestyles, and a familiarity with octogenarians still successfully working.

This is a big deal with the Boomers set to retire. They have affected the entire country at every stage of life passage, and this probably is not going to change in retirement.

The Huffington Post
Old Age Doesn't Start Until 80, Study Finds
Shelley Emling

Mike Whitney — Work Until You’re Dead?

A sizable chunk of the adult population is going to punch a clock until they keel-over in the office parking lot and get hauled off in the company dumpster. And those are the lucky ones, the so called baby boomers. By the time we get to the millennials it’ll be even worse because the economy will have been ravaged by 25 or 30 years of austerity leaving the proles to scrape by on hardtack and gruel. Pensions are already being looted, Social Security is under fire, and any small stipend that supports the poor, the unemployed, or the infirm is going to be terminated. That’s why everyone is so down-in-the-mouth, because their expectations of the future are so bleak….

Go figure. And there’s a larger point here too, which is that Americans have always believed that their children would enjoy a higher standard of living than their own. Until now, that is. Now most people think things are going to get worse, much worse. You see it in all the surveys. Expectations have changed, the future looks darker than ever before, and people are scared.

Truthdig
Work Until You’re Dead?
Mike Whitney | Counterpunch

This is clearly unsustainable politically. Look for a growing populist backlash on both left and right.

Why US baby boomers are retiring in Latin America (+video) (via The Christian Science Monitor)

Why US baby boomers are retiring in Latin America (+video) (via The Christian Science Monitor)

Former US Marine James Cummiskey is seen on one of his coffee farms near Medellín, Colombia.(Courtesy of Christian Gonzales/CIMA Coffee Farms) After 20 years in the US military, James Cummiskey was divorced and looking for a change. Relenting to his…

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Joshua Holland — How America's Retirement Crisis Is Crushing the Hopes of a Generation of Young People

...we're just at the beginning of this crisis, and with each cohort of Americans reaching retirement age, fewer will have pensions and more will have experienced the great middle-class squeeze than the cohort before it. So it will get worse before it gets better, but eventually our elites will have no choice but to finally recognize the severity of the crisis their neoliberal clap-trap has created.

AlterNet
How America's Retirement Crisis Is Crushing the Hopes of a Generation of Young People
Joshua Holland | Editor-at Large

Alyse Nelson — Cohousing Makes Tiny Living Large

The new retirement community and starter homes?

Tiny House Blog

Cohousing Makes Tiny Living Large

Alyse Nelson

Michael A. Fletcher — Fiscal trouble ahead for most future retirees

For the first time since the New Deal, a majority of Americans are headed toward a retirement in which they will be financially worse off than their parents, jeopardizing a long era of improved living standards for the nation’s elderly, according to a growing consensus of new research.

The Washington Post | Business
Fiscal trouble ahead for most future retirees
Michael A. Fletcher

Jupiter retrograde.

Kate Connolly — Germany ‘exporting’ elderly to foreign retirement homes

Growing numbers of elderly and sick Germans are being sent overseas for long-term care in retirement and rehabilitation centres because of rising costs and falling standards in Germany....

But with increasing numbers of Germans unable to afford the growing costs of retirement homes, and an ageing and shrinking population, the number expected to be sent abroad in the next few years is only likely to rise. Experts describe it as a “time bomb”.
Germany’s chronic care crisis – the care industry suffers from lack of workers and soaring costs – has for years been mitigated by eastern Europeans migrating to Germany in growing numbers to care for the country’s elderly.

But the transfer of old people to eastern Europe is being seen as a new and desperate departure, indicating that even with imported, cheaper workers, the system is unworkable.

The Raw Story
Germany ‘exporting’ elderly to foreign retirement homes
Kate Connolly | The Guardian

"Innovation."

Chris Dillow — Retirement as Freedom

And this is what Ms Tett - and more importantly, our entire political-journalistic-managerialist class - doesn't see, that work is wage slavery and that retirement is freedom.

Stumbling and Mumbling
Retirement as Freedom
Chris Dillow | Investors Chronicle (UK)

James K. Galbraith — Actually, The Retirement Age Is Too High

The most dangerous conventional wisdom in the world today is the idea that with an older population, people must work longer and retire with less.

This idea is being used to rationalize cuts in old-age benefits in numerous advanced countries -- most recently in France, and soon in the United States. The cuts are disguised as increases in the minimum retirement age or as increases in the age at which full pensions will be paid.

Such cuts have a perversely powerful logic: "We" are living longer. There are fewer workers to support each elderly person. Therefore "we" should work longer.

Foreign Policy | Special Report on Unconventional Wisdom
Actually, The Retirement Age Is Too High
James K. Galbraith | Lloyd M. Bentsen, Jr. Chair in Government/ Business Relations, Lyndon B. Johnson School of Public Affairs, and Professor, Department of Government, The University of Texas at Austin
(h/t Joe Weisenthal via Twitter)

Riverdaughter — Ok, here’s my theory about why the Masters of the Universe want to kill the social insurance programs

BUT, if you raise the retirement age and keep a lot of older people working, they will be forced to put their money back into the market. Well, they won’t be able to retire until they’re much older than their parents were at retirement. If they have any hope of ever taking time out to go travel or garden, they’re going to have to risk their money in the market, hope that it will pay off so they can get out of the job market before they’re dead and forget about social security.

My theory is that raising the retirement age forces more savings to stay in the market longer and that with a pool of people who can’t retire yet still working, the amount of money going into 401Ks and IRAs is going to go up. Stripville!

The Confluence
Ok, here’s my theory about why the Masters of the Universe want to kill the social insurance programs
Kim

(h/t Naked Capitalism)

Zero Hedge — Retirement Reality Full Frontal: Why Every 30 Year Old Must Risk It All To Be Able To Retire

...the average retirement saver will need to double their rate of savings in order to be able to retire even five years later than originally planned. If and when that sort of analysis enters into the collective consciousness of the typical American, the economic impact is likely to be grim.
As we’ve seen in the UK, higher savings rates lead to lower consumption, a decline in corporate profits, and recession.

Citi: US Credit Outlook

Zero Hedge
Retirement Reality Full Frontal: Why Every 30 Year Old Must Risk It All To Be Able To Retire

Have the folks that want to weaken Social Security, Medicare and Medicare (which funds long term care when personal resources run out) thought through the demand leakage of increasing savings?

AIG CEO Robert Benmosche: 80-Year-Old Europeans Need To Be Working

This isn't your grandpa's economy [Oh? Sure has the look and feel of Great Depression I]. But it could still be yours once you're his age.

Robert Benmosche, chief executive of the recently bailed-out and largely government-owned American International Group [Yes, that AIG], told Bloomberg from his seaside villa that he thinks the eurozone debt crisis will push the retirement age in the region way up.

"Retirement ages will have to move to 70, 80 years old," he said. “That would make pensions, medical services more affordable. They will keep people working longer and will take that burden off of the youth.”

Read it at The Huffington Post
AIG CEO Robert Benmosche: 80-Year-Old Europeans Need To Be Working

Neoliberalism at its finest.

Already one quarter of middle-class Americans expect to retire when they’re 80, not 65, according to a Wells Fargo survey from November.

 In addition, the average retirement age of American workers hit 67, according to a Gallup poll from last month. That’s up from 63 ten years ago and 60 in the mid-1990s.

Who are those productivity increases producing the increased leisure for, anyway? Pretty soon we'll be back to the seven day work week.

80 is the new 65

Americans are prepared to work longer in order to save enough for retirement, according to a survey by Wells Fargo & Co. (WFC) 

About 76 percent of respondents said it’s more important to reach a specific dollar amount before retiring, compared with 20 percent who said it’s more important to retire at a given age, regardless of savings, according to the survey of adults with household incomes or assets from about $25,000 to $100,000.

“Eighty is the new 65,” Joseph Ready, executive vice president of Wells Fargo Institutional Retirement & Trust, said in an interview at Bloomberg headquarters in New York before the survey was released today. “It’s a real sea change.”

Read the rest at Bloomberg

Wells Fargo Says 80 May Be the New 65 for Retirement Age

by Elizabeth Ody

Productivity freaks will love it, but those concerned with youth unemployment will hate it.