Olympics 2012 - Kicking the Can | earlebird.com

The Olympics have arrived and the whole world is watching.  But let’s face it, there are some strange events.  Like is ping pong really a sport?  Or should I say table tennis?  Ping pong was the name a marketer came up with when it was being marketed to the U.S. about 50 years ago.  And what about that handball game?  It looks like water polo on turf.  It’s almost like they are creating these events on the fly.  I mean , geez, why not add dodge ball or hide-and-seek?  Musical chairs might be a big hit don’t you think?  But the event that should absolutely be added is the most popular event in the free world right now.  Many countries are doing it on a regular basis and it really can be deemed as the national pastime in parts of europe and even here in the good ol’ U.S. of A.  Now I’m speaking tongue-in-cheek of course, but that event is “kicking the can down the road.”

Kicking the can down the road is a game of perseverence and attitude.  But what’s most important in this game is the public deception that comes with it.  Some of the favorites in this event would be:  Spain, Italy, and Portugal.  But I think the true frontrunners are Greece, with its cooked accounting books and doomed financial situation, and not to be outdone in any Olympic event, is the USA.  In my humble opinion, Greece would be victorious in a short race, but this hasn’t been a short race.  So you will be happy to hear, that I believe that our great country deserves the gold medal in this most important event!  We have been kicking this damn can for almost 10 years now and it should continue for another 5 years.  Not only do we have financial deficits and entitlements beyond our control, but we have the privilege to print our own currency to pay our bills.  But the world keeps buying our bonds, and if the world stops buying, then the federal reserve just buys them with more of our own money.  Oh, it works baby!  Well, at least it will work until the world gets through the other issues in Europe, Japan, or (place country here).

Be proud America. Our politicians and central bankers have made us proud by bringing home the gold.  Thank god for that because we will need all the gold we can get our hands on.  You see, by kicking the can down the road for years and years, the American dollar will be devalued beyond our belief.  Gold will be the only currency worth a hoot due to all this can kicking! 

Here are answers to some questions posed recently:

I need income for the future.  Would you recommend the withdrawal option from a variable annuity or the withdrawal option from an index annuity?  I prefer the variable annuity because you have upside growth potential in a variable annuity.  An index annuity with have limited upside and will just be paying you back your principal.  There is a reason why some insurers almost went out of business guaranteeing withdrawals from variables.  If you want true guaranteed income, buy an immediate annuity with some of your funds.

I never knew how popular index or variable annuities were in retirement.  Everywhere I go, agents on the radio or at lunch meetings are recommending these annuity products.  What caused this explosion in advisor popularity?  Very simple; it’s the guarantees combined with the so called upside potential growth.  Agents sell this as a “having your cake and eating it too” mentality.  It’s not that easy.  If the market was going up like the 90’s, many clients would be crying due to the non-growth in these products.  Remember, the guarantees will eat into your growth potential due to the extra guarantees and fees.  If we have a long bull market, you won’t be happy with the returns.  You are not “really” in the stock market when you purchase an annuity product with income guarantees.

Then why should I purchase an index or variable annuity?  Simple again, for the guarantees.  You might get returns above fixed rates, but that return will be nowhere near a return earned in a equity mutual fund during a bull market.  Make sure you know what you are buying.  Many agents paint a picture of guarantees coupled with stock market returns.  No such thing as a free lunch folks!  At best, these annuities are “turbo-charged” fixed annuities.

Pay-it Forward:

If your post-grad is having difficulties finding a job and has too many distractions, here’s an idea; you may not like this idea in our over-protective society, but buy them a plane ticket to a geographic location that has high-job potential.  A place like Texas, parts of Oklahoma and Nebraska, and northern frontier states like Wyoming or Idaho.  Jobs are plentiful in agricultural areas these days and this creates job expansion in other jobs as well.  It’s a great way for our youth to tackle adversity, make a living, and to grow up a little.  It sounds a bit hard, I know, but think of how proud you’d be of your daughter if she accepted this life challenge!

Earl E Bird

I'm Earl E. Bird and I am very concerned about saving for my senior years. I am amazed at the stumbling blocks that exist when saving for retirement. That's why I take my time when making decisions on building my nest egg.

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