Peter Morici on Obamanomics

I heard Professor Morici this morning on XM Satellite radio and he said Obama’s policies will take us to 1970s France at best and 1700s France at worst.  Here he is on CBS this morning explaining why the Obama economic policies spell doom for the economy. When I go to work I traded all the stock funds in my 401k for Money Market and other short term stability funds.  I would have gone for gold if my employer offered it.

10 thoughts on “Peter Morici on Obamanomics”

  1. Hi Henry:

    You actually can roll your 401K into gold – you can transfer your funds (or a significant portion of them) out of the 401K (which is a 4013b fund I presume) into a regular IRA.

    Now there are a couple of different types of IRAs – but the traditional IRA will give you all the flexibility you need. You simply need to work with a company that has gold (or silver) as part of their products they offer. You can buy an ETF just like a stock – GLD or SLV will give you what you are looking for.

    You can even buy common stocks, foreign stocks, bonds, whatever – it is just most major companies that manage your 401K aren’t set up to allow you to do this – they want you in their “Fidelity Managed Foreign Growth Such and Such Fund”. That way they make fees (money off your money) both ways – First, they make a 1-2% on your money for being in the fund, and then their buddy down the hall churns the account and makes additional ‘fees’ for pulling you in and out of positions in the market.

    Some people are paranoid about the ETFs – they think that “the gold really isn’t there” or that the US government will seize gold and silver if things get really bad. Now if you are really paranoid about the government intervention – you can own the actual gold bullion AND you can own it outside of US government control – in the Perth Mint in Australia. They will charge you $250 per $25,000 of gold you buy – they will hold the bars in the vault, you can walk down and look at them and take them out anytime you want. It is insured by the Mint Itelf, the Western Government of Australia, and Lloyds of Londan.

    All of this can be done in with your IRA money.

    If you want to hold gold bullion in your safety deposit box at the bank in your IRA, you can do that also – but you are only allowed (via IRS regulations) to hold silver or gold American Eagles (or various denominations approved by the IRS thereof, so you can’t own south African Kugerrands, etc) and once again, those gold products have been subject to confiscation in the past (twice in US history).

    Sorry, this email is a little longer than you wanted to hear I am sure.

    Remember, you can own virtually anything in your IRA, it just has to be set up right. There are restrictions (for example only US approved bullion coins or buying stocks on the longside) You can own land or real estate, even rental property (in a self-directed IRA) but only withing the continental United States, etc.

    It’s just the funds (the investment banks) don’t make any money off you if they help you to get your assets into those areas – because the mutual fund industry is making a killing by having all that money under their management.

    If you are interested, check out Crash Proof by Peter Schiff, it’s a fun book, also on audible.com – you can watch him on Youtube here and see what he is about. They can get your stuff on those areas, but his brokerage fees are not cheap – better than watching your life’s work burn slowly though….

    Cool.

    PS: I think gold is great, but if you are really worried about inflation… check out silver…..

  2. Problem is you can only roll over a 401(k) post-employment. So, investment-wise you’re better of getting laid off. Thank you, Obama.

  3. Cigar Mike, cash will also get hit when the growing monetary inflation turns into price inflation. Only a matter of time…

  4. I think jluix is 100% right on about the inflation but right now it is a question of when.

    When does Cigar Mike think the bottom is going to be reached (and more importantly, how will we know where the bottom is?)

  5. Here’s a prediction I’m pulling out of my tin hat:

    Once the Dow goes below 6000, and probably after health care is nationalized, Obama will present the nation an offer it cannot refuse: return your 401(k) to August-2008 levels and transfer it into a 3%-yielding gov’t pension. In exchange, 401(k)s will be terminated, and their former pre-tax status and employer-contribution expense become a new source of govt tax revenue. This is the plan the Dems held hearings on last Fall. In other words, 401(k)s and equivalent plans will be bailed out by nationalizing them.

  6. Wow! Dow 6000, I was thinking it was headed lower….

    you know I was thinking about it, since the United State has gone socialist, why not bring pobrecito Roque into the Obama administration to help out with selling these new programs to the American people – Felipe can’t be worse than that mono Robert Gibbs….

    Catch you guys later…..

  7. That’s the thing I just rolled my 401k from my last employer into that of my current employer. I put everything into money markets and shorter term investments today. For example I switched from the Fidelity 2035 fund to 2015 as if I were retiring in 6 years.

    Whatever. It’s all theoretical at this point anyway. I’ll be making $400,000 a year once the hyperinflation hits.

  8. What you should have linked to was the video of Cramer admitting that he wished he hadn’t voted for Obama. Here is that famous arguer with Kudlow who is recanting and telling it like it is. Watch it.

    That idea of nationalizing our 401 k’s, maybe that’s Obama’s goal. He will nationalize everything.
    Does any of this sound familiar to readers of this blog? He’s doing what Castro did but in a nicer way without the shootings and beatings and imprisonments. This is America, after all. You have to smile nicely and be a great orator and do it all with a velvet touch. But the result will be the same unless liberals wake up in time.

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