Monday, January 10, 2005

Let's Declare A War On Ignorance!

We've declared wars on many other nouns...

It's way past time, folks!

Investment pros see bonanza

Social Security proposal would add billions to investments and fees

By Ameet Sachdev and Lorene Yue, Tribune staff reporters. Tribune correspondent Mark Silva contributed to this report
Published January 9, 2005

The prospect of 100 million Americans each having $1,000 of their Social Security contributions to invest every year has investment professionals salivating at the potential financial bonanza.

About $100 billion a year would be freed up for stocks, bonds and other investments under a tentative plan President Bush has floated to fix the Social Security retirement system by creating private investment accounts.

The fees paid to brokers and money managers could run into the billions.

President Bush is expected to unveil the plan in late February, with administration officials eyeing investment accounts that would hold two-thirds of workers' annual payroll taxes.

Though the White House has cautioned that Bush had not decided on a specific plan, the administration is leaning toward letting workers divert 4 percent of their wages, up to $1,000 to $1,300 a year, into personal accounts. The remainder of the workers' payroll taxes would continue going into the system.

"The potential for investment firms has to be mouthwatering," said Michael Falk, chief investment officer with Chicago-based ProManage LLC, which helps workers manage their employer-sponsored 401(k) accounts. "We're talking about billions of dollars." LINK

Billions of dollars in broker fees.

Ignorance is bliss?

Guess what!

What you don't know often bites you in the ass.


Heavy sigh.


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