I just looked at my 401(k) for the first time in a couple weeks. Down 17.4% for the year. I’ve been in the US for about 9 years, and have had a 401(k) for about 8 years, so I’m going to bet that my 17% loss represents a far smaller number in actual dollars that some of you who have been saving for 20-30+ years.
I guess I shouldn’t complain. When John McCain was in the Hanoi Hilton for five and a half years, he probably didn’t even have a retirement account. Of course, now he does.
And I bet she’s doing better than mine.
kid bitzer
“When John McCain was in the Hanoi Hilton for five and a half years, he probably didn’t even have a retirement account.”
actually, no. i’m betting that he was counted as serving towards his twenty years during that time, and so earned time towards his pension.
which is only fair, really–we don’t want to tell people in the service that we’ll take care of their retirement, unless they get taken prisoner. so, i’m not saying he should *not* have had a retirement account (or the equivalent) building up during that time.
but i am saying: i’m pretty sure he did. jc and the other vets will know for sure.
Montysano
Imagine how hard BushCo must have worked to delay this financial meltdown until about, say, Nov. 5. But when you’re juggling 10 running chainsaws, absolute predictability goes out the window. This should be a rich vein for Obama/Biden……if they still want the job. There are now several banks, the insurer AIG, and the Detroit automakers who are wheezing and clutching their chest. Jeebus, what else can the GOP fuck up before 1/20/09?
Seanly
I’m far enough away from retirement that the huge losses won’t matter. Or else the whole system collapses and we get the quasi-apocalyptic world of the first Mad Max movie. Do you know how to garden and shoot? Two good skills for the coming lingering death of America.
gypsy howell
It will matter to you when all the baby boomers who are starting to retire now find out they don’t have any retirement money left thanks to the miracle of the free market, and America will have to decide whether you’re going to bail them out, or whether you’ll all be OK with seeing your parents and grandparents living on the streets (or with you), the way it used to be.
Don’t be fooled into thinking this will just be the baby boomers’ problem — it will be everybody’s problem.
Conservatively Liberal
How about Jeb Bush having Florida buy $900 million in Lehman junk and then getting a job there after leaving office?
If a Bush is involved in anything it will invariably end in a disaster. In fact, it seems that a disproportionate number of scammers in the financial world are Republican, and this wreck of an economy should be an albatross around the neck of the Republican party. I am not looking forward to the mess ahead but the timing for this mess could not be better for the Democrats. They are not innocent but they are not covered in blood either. The Republicans are soaked in it.
The bad news for McCain is that this financial market crisis will give the news a fair excuse to dredge up the Keating 5 scandal. Maybe bring up some other Republican based financial scams just to spice the whole thing up a bit.
I could go for that. :)
I sure hope they do, and soon.
Davis X. Machina
How about Jeb Bush having Florida buy $900 million in Lehman junk and then getting a job there after leaving office?
That’s typical. He and Charlie Christ had the state public teachers’ pension fund buy the failing Edison Schools, which runs privatized schools, an investment which now trades a little higher than magic beans.
It’s one thing to sell someone the rope to hang themselves, it’s another thing to make them buy it.
Mary
How about Jeb Bush having Florida buy $900 million in Lehman junk and then getting a job there after leaving office?
I thought this was a hypothetical. Then I Googled (despite my rotator cuff pain). Talk about falling upstairs. But I guess even Escher staircases fail after a while.
Dennis - SGMM
Today’s WaPo has a short article on Lehman.
What caught my eye was that Lehman owes its 100,000 creditors worldwide a total of $613 billion dollars. Its assets, which will be sold off by a bankruptcy court to pay those creditors, consist largely of sub-prime mortgages. I find it impossible to believe that no one, no one in the Federal Reserve, business, Congress, the Treasury, said in a loud, clear voice “This is a terribly risky way to do business and it could have dire consequences.”
I’d guess that the silence was necessitated by the fact that in a nation that doesn’t make much of anything and still lives beyond its means, money has to be spun out of thin air.
TheFountainHead
Mmmmmm, it’s a great time to be young and employed in the entertainment sector…
…oh wait…no it’s not.
Napoleon
Actually if it happened 6 months earlier it could have been better since studies say that how one views the economy 6 months out is what their vote is based on come election day, so if that holds all this will have little/less effect, but still it would have been hard to get much better on timing (its not like 4 1/2 months ago was a whole lot better then today).
Person of Choler
Dennis – SGMM finds it hard to believe (as I do) that “no one in the Federal Reserve, business, Congress, or the Treasury” warned about the coming debacle.
Before fingers are pointed, Congress, please remember, includes Senators Obama and Biden.
harlana pepper
I think this is what’s called ‘red meat’ for the Dem ticket. I don’t give a fuck if they were complicit in some ways. I used to care about such nuance, but not this time. Repubes were ruling for 8 fucking years. This is a direct result of their ‘borrow & spend and damn the consequences on the next generation’ philosophy.
Get on it Obama/Biden!
bootlegger
Anybody catch Obama’s awesome snark: “if you believe that, I’ve got a bridge in Alaska to sell you”? Priceless.
My TIAA-CREF retirement products are down anywhere from 22% (Global Equities) to 4% (social choice).
PeterJ
Can we add some more cowbell? Yes, We Can!
cleek
i’m afraid to look at any of my accounts.
Ruth
McAyn campaign claiming Obama ads are unfair for criticizing his inability to use a computer, since as a POW he got crippled up, see. Can’t raise his arms. Or IQ. Or all of the above. Sorry, can’t say ‘above’. He was a POW, remember. Can’t look up….
Walker
Actually, the cynic in me sees this as a lose-lose situation.
If McCain wins, his borrow-and-spend policies (assuming he carries out what his platform says he will) will destroy this country. As in the US may have to default on some bonds. And when that happens, it is game over. Our standard of living will never, never, never recover from that.
But if Obama wins, this mess is so bad I cannot possibly see what he can do to fix it during a 4 year stint as president. Sure, he can keep us from going into Mad Max territory (I am not convinced that McCain is even capable of that), but he will still get blamed for a bad economy under his watch. And that means another borrow-and-spend Republican destroying the economy in another 4 years.
chopper
gleh. well, my TSP is tied up in the G fund which is pretty stable. bonds, mostly. not huge returns but in this economy…
Conservatively Liberal
Keep an eye on AIG as there was some late night footsies going on (nothing new there). Strange that the Fed wouldn’t step in for Lehman, and they say that there are no more handouts, but they are actively involved in trying to save AIG.
Timing is everything with AIG. The ratings game can turn them into junk in seconds, and the threat is there.
harlana pepper
OT: Cowbell? wtf? All I want to know is how I can get Christopher Walken and it won’t let me. Don’t advertise what you can’t sell easily. lol
Grumpy Code Monkey
-25.7% YTD. Ouch. On the bright side, Fidelity appears to be absent from most front page stories. Doesn’t help when every stinking fund is hemorrhaging, though.
Never attribute to malice that which can be blamed on incompetence, but I’m starting to wonder if some of this isn’t a deliberate effort to impoverish as many Americans as possible for … some reason that escapes me.
harlana pepper
Mark says:
Rest assured, the Dems will be blamed for everything. Hopefully, it won’t stick again for another 60 years or so, if we make it that long.
Napoleon
And think, peoples 401 (k) statements will be hitting their mailboxes 3 weeks before election day.
ThatLeftTurnInABQ
Lehman was expendable, in fact they pretty much had to throw somebody to the wolves just to help justify the additional bailouts that are down the road still to come.
AIG on the other hand, if they fail, could trigger a freeze up of the whole enchilada (the credit markets that is), because they were insuring other parties against risks which are starting to look very real, so if they go down then all of a sudden it’s winter time and everybody is walking around naked.
As usual, Yves Smith sums it up in understandable terms:
Rome Again
Every small business that needs an infusion of cash from time to time to purchase supplies before they see a profit? I hope they got their corporate American Express card.
Shit rolls downhill, don’t forget that.
One thing I noticed overnight, I took a look at the almost super secret distressed banks listing (as opposed to the really super secret list the FDIC has), and… not a single one is in Delaware. ;)
Credit cards will be safe, apparently… at least until people can’t afford to pay their balances en masse.
ninerdave
a 401k is a long term investment. Looking at it short term is stupid. If you are diversified and looking to the future, you should welcome down years, as your contributions will be buying more of whatever it is you’re investing in.
If you’re nearing retirement you shouldn’t be in the market and instead in fixed income investments.
HyperIon
i’m about 5 years out and dropped to 20% equities in my TIAA-CREF account in march. because 20% stock/60% fixed/20% bond & real estate is considered a VERY conservative position, lots of folks laughed at me then. i’m still losing money but not as much. i’m a fraidy cat investor: can’t sleep at night? move out of the stock market.
blogreeder
Michael D., Do you withdraw from from your 401K on a daily basis?
TenguPhule
Keep in mind you need to make double your losses to break even here.
Short term may look stupid, but long term is made up of a lot of short terms.