Good as gold

One should be wary of any retirement scheme which relies upon investments as the current financial mess has emphasised. The usual advice is that you don’t invest unless you have money to spare: which people’s retirements don’t. Of course, The elderly are frequently victims of confidence tricksters. Which is an interesting coincidence since my next question is “what is the difference between a Ponzi Scheme and some complex financial instruments?”

It seems to be not much. Matthew Sweeney’s The Lottery Wars is causing me to question how much of a gamble the current financial markets truly are after reading this in the Wall Street Journal review of the book:

In the 19th century, fueled by the need for public funds and the rise of professional gaming operators like P.T. Barnum, lotteries became ubiquitous, and the profit motive came to predominate. Lottery entrepreneurs handled the many different banknotes of the age and soon branched off into trading in stocks and other securities, all of which made them precursors to modern investment banking (or what’s left of it). The lottery even played a role in the development of derivatives: The modern illegal numbers racket, in which people bet on a reliable daily number (such as Federal Reserve clearings or New York Stock Exchange trading), started as a form of insurance whereby lottery players could make small side bets to hedge their risk — by betting against their own number, for example.

It makes me worry when the Wall Street Journal calls Lotteries the “precursors to modern investment banking”!

It is probably more worrying that “Bernie” Madoff could scam some fairly respectable financial minds. This is especially true since federal investigators believe that not only had the fraud begun as early as the 1980s (it ran to 2009), but that the investment operation may never have been legitimate.

Oddly enough, this all began at the time that people were clamouring for deregulation and “privatising social security”. IRAs, 401ks, and other investment based retirement plans also became the norm at about this time. I thought it smelled like shit, but it seems that I have been a voice in the wilderness. That’s really strange since the rich are getting richer and the rest of us are getting fucked.

The economy is collapsing and any attempt to fix it is a bit like trying to keep a terminally ill patient alive. The “solutions” offered by the tea party are akin to having Jack Kervorkian come in since they are the ones which got us into this mess in the first place.

On the other hand, no one is offering real solutions since they will be deemed “Socialist” or worse by the powers that be. The real solution is for government to spend more (per an investment banker friend), but no one wants to come forth and offer that solution. In fact, I worry that the public will be ever hopeful of the simple solution which offers a quick fix but makes as much sense as taking two aspirin for a massive coronary. Additionally, the public is so easily distracted by “god, guns, gays, and abortion” that it doesn’t pay attention to the real problems out there.

In the mean time, the best thing is to buy a lottery ticket. While your chances of winning are next to zero–they are zero if you don’t play.

It’s probably the best investment out there these days.

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