The End of Retirement?
According to John Michael Greer the outlook for retirees in the coming years is going to be bleak. In a recent blog post he claimed that most of the securities and assets that retirees depend on will lose more than half of their face value. This speculation is based on his belief that the investment practices of the last 30 years which turned debts into assets has left the market flooded with unpayable debts across all sectors of the economy.
When the value of all these debts are added together, says Greer, they far exceed the revenue created by the aggregate amount of the global economy. Basically there is not enough money on the planet to pay for these debts.
For anyone approaching retirement age this is bleak news. It has become a common practice for a large number of people across the world to base a substantial portion of their income on investments. However, if the global market is as unstable as Greer claims in his blog post, these securities will lose the vast majority of their value in the coming years resulting in massive losses to everyone’s retirement plans.
It goes beyond securities however. Even money put into simple saving accounts at people’s banks will be under threat. The weak global economy will ultimately create a period of substantial deflation. The problem is that most of today’s wealth is just paper. The wealth is not based on anything substantive. In other words it is imaginary wealth. As the market comes to realize this the value of our money will begin to drop, possibly to the point it is virtually worthless.
Totten argues that this destabilization in the economy will be felt across all market sectors – stocks, bonds, currencies. Even assets like crude oil will lose the vast majority its value. Within the next decade or so there will be no safe bet for retirees to rely on.
The question is what happens after this current economic crisis is over? The news is still not good. The current retirement system is based on the “age of abundance.” When the dust settles and the current crisis is over we will have left this age behind and returned to a time where the majority of economic activity happens outside of the market. Household economies that used to exist in the past will arise once more. The success of these households will depend on the contributions of everyone, including the elderly. Of course this process will not happen overnight; it will take many years before this type of economy rises again.
For anyone near retirement age or already retired, Greer advises you to take all your money and put it into the most stable investment you can find. Also it is essential you begin putting a Plan B into place right away.
Comments
Leave a Reply
Settle Tax Debt Fast!
Get Foreclosure Help
