The So-called Economy

Continuing a pattern that has really never worked for me, I'm writing about something I don't know anything about.  Why should I change now?

Like lots of other retirees, I am living off savings, which are managed by a retirement company, and these savings have declined by about 20% since they peaked.  So that tells you just how much my thoughts are worth.  If I knew what I was talking about, I would have requested the company to move the money into precious metals, or bonds, or just cashed it out, or something.  Now I'm going to have to hope that I die before the money runs out!  (Just kidding.  Or ... am I?)

See, the 'value' that my savings is supposed to have is what the stocks that I own are valued at.  (In principle, I can sell them for that price if I act fast.). But these prices are really based on what investors think they're going to be worth.  Right now, investors don't know what's going to happen, so their guess at the prices of stocks is low.  If they think that trump is going to be president again, and give big investors a tax cut, the stock market would go through the roof, and the value of my stocks, too.  But trust me, I'd rather lose half the value of my stocks than have the afore-mentioned team get the white House.

At one time, the value of the dollar was tied to gold.  But not today.  Today dollars are auctioned off, and what the buyers are offering for dollars are the value of them.  Actually, something similar goes on with stocks.  Investors in a lousy mood will be unwilling to buy stocks, so the price goes down.  Once the price going down is observed, the price goes down even more.

After election day, stocks usually go up if Republicans win big.  Investors usually think Republicans are good for business.  If Democrats win, investors will buy stocks in the undertaker's industry, betting that lots of Republicans will be slitting their wrists, or storming the Capitol, or whatever the plan du jour is.

This brilliant idea to base the value of stocks on their asking price--or whatever--makes it impossible to plan.  Retirees have to gamble, and most of us hate to gamble.  We're "risk adverse," as they call it.  My wife and I were asked, some years ago, whether we would prefer to buy an annuity.  This is an interesting idea, where the retirement company signs an agreement to pay us an income for life.  No matter how long we live!  They are gambling that we won't live too long, in which case they keep all the money they've set aside for us.  At the time we were considering this idea, my wife and I were really wondering whether the economy would tank.  If it is likely to tank, the safe decision is to buy that annuity.  If it is likely to keep healthy, it would be better to keep control of our savings.  Well, what do you think we did?  And what do you think happened?  My only consolation is that Trump's stocks must be shrinking too, and faster than mine!  Unless he owns a lot of gold, and you know, be seeing how obsessed he is with gold --i mean, he paints everything gold.  As soon as he buys (or steals) something, he paints it gold.  Good thing the FBI found all those documents before the painters got hold of them!

I have no advice for you.  We don't know enough--or I don't know enough--to advise.  If I were still contributing to my retirement savings, I would be delighted, because the retirement company would be buying up all these low-priced stocks on my behalf, and whenever this economic slump ended, I would be sitting pretty.  So I guess all my young readers would be happy, while other retirees would be just as anxious as I am.  Sucks to be us.