Tag Archives: pension funds

Labor Threatens Super Funds To Prop Up The Banks

5 Apr

Illustration by Zeg | Click to enlarge

I accept that some readers may not see the red flag that I see waving all over the following story.

So be it.

In my view, what we have here is a clear preliminary step down the path to government “intervention”, to “save your super” from the risks of the “volatile” sharemarkets.

First by “encouraging”, later forcing, your super fund to invest where the government dictates is a “safe” place for your retirement savings.

That could be the “safety” of government bonds.

Or perhaps, as strongly hinted at by this story, it could be the “safety” of bonds issued by our banking system … who just happen to be “overleveraged” according to the ratings agencies, and recently pitched threatened the government to help them with additional sources of funding in order to “save the mining boom”.

The ‘softening up’ process, the art of steadily planting seeds in the public mind and preparing them for a future event, is called “perception management”.

Here is Business Spectator’s Stephen Bartholomuesz making the argument for the government … prompted by a speech from the former Finance Minister Lindsay Tanner, in which he clearly threatened “government intervention” to force super funds to invest where the government wants them to (more on Tanner’s threat below):

Former federal finance minister Lindsay Tanner may have been overstating the risk of government intervention to correct a perceived bias towards equities within superannuation fund portfolios yesterday but the issue he was highlighting is worthy of further discussion because it contributes to the debate about the need for a developed corporate bond market in Australia.

In a speech to the Ownership Matters conference in Melbourne yesterday Tanner actually approached the issue of the overexposure of super funds to equities from that starting point – the absence of a developed domestic corporate bond market.

The disproportionately high levels of exposure to equities in most balanced fund portfolios is only one strand of the explanation for the absence of a functioning domestic bond market, albeit a material one.

During the great decades-long bull market in equities leading up to the global financial crisis, the bias towards equities in most super funds generated returns that, from a long-run perspective, were aberrational. The GFC reminded investors, and super fund members, that while equities might deliver higher returns relative to most other asset classes over the long term they do so because they carry greater latent risk.

As the population ages, the tolerance for risk will decline. Indeed, with the GFC as a wake-up call, it has already declined. Hence the deluge of funds that has poured into term deposits and other fixed interest securities as investors and super funds have been introduced, painfullly, to the concept of risk-adjusted returns.

Translation: For decades, everyone’s super went into the sharemarket; thanks to the GFC everyone has lost a fortune; now, everyone is more risk averse, and so their money is going into lower risk investments like term deposits.

For the foreseeable future the environment for equity markets is likely to be quite different to that which prevailed before the GFC.

That would suggest that, particularly for the demographic bulge moving towards retirement, the appetite for equities will diminish and therefore the proportion of equities within fund portfolios will trend and remain lower than it was pre-GFC.

As I was saying.

And now – for those with eyes to see – the red “danger!” flag appears (emphasis added):

We’ve already seen a flurry of listed corporate bond issues earlier this year as companies have capitalised on the risk aversion and desire for yield of investors, particularly the rapidly-growing self-managed fund sector.

If the major banks were to issue listed bonds, and the federal government ever delivers on its promise to facilitate the listing of Commonwealth government securities – which would provide a pricing benchmark for all other issues – a properly functioning, liquid corporate bond market that can be accessed by retail investors and SMSFs could be developed, one which might also encourage the large super funds to become bigger players.

As regular readers know, this clearly hints at exactly what I have long argued is the inevitable fate of Aussies’ super.  Our all-knowing, all-caring Big Brother government – whether Labor or Liberal matters not – will decide to “help” you, by creating mechanisms to redirect some (and eventually, all) of your super into “investments” that the government deems to be “safer” than the share market, and/or “investments” that are “in the national interest”.

They already tried last year, by “encouraging” super funds to invest in their “nation building” infrastructure programs like the NBN. Fortunately, the super funds were smart enough to resist.

But when push comes to shove, you can be sure that the government will move on from “encouraging”, to enforcing.

For your own good, of course.

Back to Batholomuesz:

Given the post-GFC environment for the major banks – they are holding a lot more capital, more and more expensive liquidity, experiencing higher funding costs and face the imposition of a simple leverage ceiling within an economy where households and businesses are deleveraging and demand for credit is therefore very weak by historical standards – it is unlikely that they will return to intermediating mid-teens credit growth any time soon.

Indeed, having had a nasty experience during the GFC, when their own overexposure to wholesale funding markets highlighted their own vulnerabilities, it is likely that the banks will manage their balance sheets far more conservatively in future than they have in the past, with an acute focus on the stability of their funding.

One of the reasons the major banks built up their reliance on offshore wholesale funding was the increasing diversion of Australian savings from bank accounts to super – and a majority of it into equities – as the super system grew over the past quarter of a century.

Bartholomuesz clearly argues that the banks are overreliant on offshore funding because you and I preferred to have our super in the stock market. The thinly-veiled implication is that the banks’ current problems are really our fault, you see. And the unstated implication being, that it makes sense for our super to fix that problem now, by redirecting it into bonds issued by those “safe as houses” banks.

More of those funds within the super system will, if fund members and their trustees shift to a more balanced and defensive posture and (thanks to the GFC) have a better understanding of risk-adjusted returns, become available to both the banks and corporate borrowers.

And there you have it.

We all just need to “have a better understanding of risk-adjusted returns”, and everything will be rosy … we will want to have our super invested in bonds issued by the big banks.

Even if it is just a “relatively modest” amount of our super:

Given the size and growth rate of the super system, relatively modest re-weightings of fund portfolios away from equities to fixed interest securities could have very significant impacts and could – indeed, should – occur without any need for government intervention.

That red flag is waving a little more strongly now.

And if we still don’t want to have our super propping up the banks?

Bartholomuesz’ final sentence rings out like the death knell I believe this article signals:

There probably aren’t too many super fund members who’d be enthusiastic about the prospect of Wayne Swan dictating how their savings were deployed.

Indeed.

Won’t stop him though.

Take the carbon tax CO2 derivatives scam as a case in point.

And if we consider closely what Lindsay Tanner wrote in the Australian Financial Review yesterday, then I think it is crystal clear what the government has in mind:

As the vast sums involved here are compulsorily directed to a particular form of saving which enjoys preferential tax treatment, those managing the funds can hardly go on about the sanctity of the free market. As concerns about corporate funding rise, and worries about risk in our super system mount, the only guaranteed way to avoid government intervention is for the major players to deal with the issues themselves.

For those with eyes to see and ears to hear, that is a clear threat to super fund managers.

Redirect Aussies’ super into propping up the banks.

Or the government will make you.

Advertisements

Take THAT, Politicians! Super Goes Backwards In 2011

20 Dec

As regular readers have known for quite some time, there’s far more to be concerned about than your super “nest egg” merely going backwards.

So, in the spirit of the silly season, let’s all look on the bright side.

It’s sort of nice to know, in a bittersweet kind of way, that the government is going to get less money when they finally do steal your super:

SUPERANNUATION funds have posted their worst performance since the height of the global financial crisis in 2008 as Europe’s debt problems cut returns from capital markets.

The fall in super valuations this year will be the second time in four years that pension funds have lost money, although the downturn is not as drastic as it was in 2008.

Research firm Chant West estimates that the average fund will have shrunk in value by around 2 per cent by the end of calendar 2011.

By contrast in 2008, funds lost an average of 21.5 per cent, according to Chant West data.

Chant West investment research manager Mano Mohankumar said that even after a 15.1 per cent rise in 2009 and 4.7 per cent return in 2010, many funds “still have some ground to make up”.

The latest data is based on 60 funds with balanced portfolios – typically around 30 per cent in Australian equities and 26 per cent overseas equities.

Mr Mohankumar said market volatility had eaten into workers’ investments and that this was likely to continue in 2012 as European leaders grappled with the fallout of the eurozone debt crisis.

“We expect the heightened uncertainty to continue over the next 12 months,” he said.

“We think the European situation will take longer to resolve than the markets hope it will.”

By the way, are you a reader of the generally excellent MacroBusiness superblog?

Then you might like to give the excellent contributor The Prince a good-humoured raspberry for stealing my witty “No Super For You!!” headline for his post yesterday … without attribution. A direct pinch … right down to the accompanying Seinfeld “Soup Nazi” image.

Coincidence?

I think not.

Indeed, I think he knows exactly where he got it from … given that I personally alerted him to my numerous governments-are-confiscating-super articles and news source references – including the May 2011 original “No Super For You!” – a loooong time ago 😉

It seems that Barnaby (and admirers) are still too unfashionable for the experts to give credit where credit is due.

Even though the tides of time continue to prove that …

Barnaby is right.

Grand Theft Super – A Very Subtle Form Of Theft

7 Dec

1930's Depression-era cartoon

The Sovereign Man, Simon Black, explains how our very system of modern government public sector financing is … just like private sector financing … nothing more than a Ponzi scheme.

Don’t miss his comment at the end, about how the UK government is effectively stealing citizens’ super. It’s just one of the several ways that our own government has already set in train the policies to do the same (emphasis added):

Say what you want about him, but Bernie Madoff was a guy who knew how to keep the party going. For years, he ran one of the largest private-sector Ponzi schemes in history and always heeded the golden rule of financial scams: make sure your inflows are greater than your outflows.

He was finally done in when redemptions exceeded new investments. He didn’t have enough cash to pay out investors, and he wasn’t able to scam more people into paying in to the scheme. As a result, Madoff finally had to admit that the whole thing was a total fraud.

Governments around the world are in similar situations right now with their own public sector Ponzi schemes. Faced with failed auctions, declining demand, and rising yields, politicians are having to resort to desperate measures.

Like any good scam artist, they’re appealing to the masses first; all over Europe, governments are sponsoring new marketing campaigns suggesting that it’s people’s patriotic duty to buy government debt.

In Spain, they’re actually issuing instruments called ‘Bonos Patrioticos,’ or ‘patriotic bonds.’ Ad campaigns say that the bonds are “good for you, good for the future.”

In Ireland, they’ve issued “Prize Bonds” which carry a 0% interest rate; instead of receiving interest, bondholders are entered into a weekly lottery contest.  Naturally, lottery winnings are only possible as long as people keep buying the bonds… pretty much the definition of a Ponzi scheme!

In Italy, they’re rolling out the country’s sports celebrities to encourage everyone to buy Italian sovereign debt.

What’s ironic is that Italy’s dismal balance sheet is almost universally acknowledged. It’s as if everyone knows the country has almost no chance of making good on its obligations, but they still feel the need to willingly throw away their hard earned savings for the greater good of political incompetence.

Thing is, it’s not the millionaire sports stars, wealthy business leaders, or political elite who are buying these bonds… at least, not in anything beyond a token, symbolic amount. It’s the average guy on the street who really stands to get hurt when the government finally capitulates.

This is a truly despicable act and amounts to theft, plain and simple.

The United Kingdom, which is rapidly reaching this banana republic sovereign debt status itself, has unveiled a plan to issue roughly $50 billion in infrastructure bonds. This would be the equivalent of issuing $300 billion in the US– not exactly chump change.

Given Britain’s already colossal debt level, private investors aren’t exact diving in head first to loan the government even more money.

Undeterred, British Chancellor George Osborne plans to ‘highly encourage’ UK pension funds to mop up about 60% of the total amount. “We have got to make sure that British savings in things like pension funds are employed here and British taxpayers’ money is well used,” he said.

In other words, ‘we are going to make sure that British people buy our junk, one way or another.’

The last year has seen numerous pension funds around the world, from the United States to Argentina to Hungary, be raided for the sake of keeping these Ponzi scheme going.  The UK is already lining up to be the next.

It’s one of the last acts of a truly desperate government to begin directing public and private savings into their Ponzi schemes.

Fast-forward a few downgrades and you can plan on seeing the exact same thing in the United States– appealing to people’s patriotism to loan their hard-earned savings (if they even have any) to the Federal government at a rate of interest that fails to keep up with inflation.

It’s nothing more than a very clever (and subtle) form of theft.

Those UK plans ring any bells?

They should … alarm bells.

Your humble blogger has been ringing that same alarm bell ever since the May budget, when our government quietly announced exactly the same plan:

… Barnaby is warning that it could happen here too.

The first steps in that direction have already begun.

From Global Custodian (Australia edition), 11 May 2011:

The Gillard government’s 2011-12 budget has proposed a raft of initiatives aimed at encouraging superannuation fund and private investment in infrastructure projects.

In light of the botched “school halls” program, and the stalled white elephant NBN – which so far has only achieved a 12% takeup rate, versus their predicted 58% – would you really trust this government to wisely and prudently invest your super in Government infrastructure?

Others have their doubts.

From The Australian, 12 May 2011:

The government’s plan to use tax incentives to encourage superannuation funds to invest in new infrastructure could be thwarted by inadequate returns on projects and a reluctance by the states to take on project risk, experts say.

First, a little “encouragement” for super funds to invest in government spending programs.

Then, when the costs blow out, or when the government debt becomes unmanageable?

“No super for you!”

We also said this:

Labor’s PM-in-waiting, the Minister for Financial Services and Superannuation, Bill Shorten, already thinks of your super as a “significant national asset” … a kind of “sovereign wealth fund”.

From The Australian, 4 May 2011:

Superannuation is our sovereign wealth fund

This week marks 12 months exactly since the government announced plans to take compulsory superannuation from 9 per cent to 12 per cent.

… our superannuation savings place Australia fourth in the world. Its $1.3 trillion in funds under management through superannuation significantly boosts national savings and provides greater retirement security for millions of Australians. Superannuation is also a significant national asset because it strengthens our financial sector.

Have no illusions, dear reader.

Green-Labor already have their eyes firmly fixed on stealing your super, using exactly the same “infrastructure bonds” scam as the Pommy government.

After all, why not?

In their twisted rationale, your super is a “significant national asset”.

“Nation building” infrastructure is a “national asset” too, right?

You know … electrified ceiling insulation, overpriced school halls, “green scheme” rorts, the no cost/benefit analysis Nation Bankrupting Network.

So of course it makes perfect sense to “encourage” your super fund (mis)manager to “invest” your super the “significant national asset” in … significant national infrastructure assets.

Then, when the economy nosedives, the banks collapse, our government hocks the taxpayer (and their children and grandchildren) to the moon to bail them out, and ultimately (like the rest of the West) goes cap-in-hand to the IMF for loans, your super that’s been invested in that “national infrastructure” … will get handed over to the IMF as collateral on unpayable sovereign loans.

Just like in every other country where the IMF is asked for “help”.

If you’ve not yet woken up to the reality that neither “side” of our political spectrum can be trusted (at all, much less) to keep their hands off your retirement savings, then consider this.

Labor has already begun the subtle, insidious process of “encouraging” your employer to funnel your future super payments directly to the ATO.

A policy stolen from the Liberal Party.

I know.

I got their letter:

(Click to enlarge)

Wake up Australia!

It’s time to take the red pill.

The Matrix: "You take the blue pill – the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill – you stay in Wonderland and I show you how deep the rabbit-hole goes." - Morpheus

UPDATE:

(h/t reader JMD) Another example of a desperately over-indebted government trying to bribe/coerce/con the citizenry into keeping the Ponzi scheme going:

‘Gold For Bonds’ in Japan as Bond Buyers Get Gold Coins

Japan will reward investors who buy reconstruction bonds with half an ounce of gold, an added incentive that could boost the return by nearly six times according to Japanese Finance Minister Jun Azumi.

Individual investors who purchase more than 10 million yen ($129,000) in the debt with a 0.05 percent return and keep it for three years will receive a gold commemorative coin weighing 15.6 grams (0.55 ounces), the Finance Ministry said in Tokyo today, worth about $948 based on current prices for the precious metal.

Another Government Raid On Citizens’ Super

5 Dec

Yet another government has joined the ever-growing list of those stealing their citizens’ super to plug holes in their budgets:

Portugal has raided €5.6bn (£4.8bn) of pension fund assets in a controversial scramble to meet its deficit targets.

The cabinet agreed to transfer the assets from four of Portugal’s biggest banks to the state balance sheet.

The assets will be used to bridge a gap needed to meet the fiscal deficit target of 5.9pc of GDP set by the terms of the country’s €78bn bail-out from around 10pc in 2010.

“This measure is more than sufficient to meet the budget deficit goal in 2011,” said Helder Rosalino, secretary of state for central administration, on Friday.

Portugal said it had informed the EU and IMF and assured them it would be a “one-off”. However the 2010 budget was met by shifting three pension plans from Portugal Telecom on to the public social security system. The liabilities don’t count, yet.

What is particularly noteworthy, is that this blatant theft of Portuguese citizens’ superannuation is being done in order to meet an IMF-imposed deficit reduction target.

Just like Ireland earlier this year, when it too was ‘forced’ to raid its citizens’ super.

Your humble blogger has been documenting the wave of largely unreported super thefts that has been rolling around the world since the GFC began in 2007-08.

And warning that Australia’s politicians are already firmly on track to do the same here as well.

Indeed, the Green-Labor government has already quietly introduced a new policy directing your employer to send your future super payments to the ATO.

A sneaky policy neatly stolen from the Liberal Party.

No need to wonder why both “sides” of Australian politics want to increase the super rate from 9% to 12%.

To glimpse the truth – that government theft-by-stealth of your super is inevitable here too – all you need do is look at our ever-rising debt trajectory …

Commonwealth Government Securities On Issue | Source: Australian Office of Financial Management (AOFM)

… note that Wayne’s latest budget update predicts a 57% blowout in net debt this year alone, observe the ‘slow-motion train wreck’ occurring in the global economy as a consequence of massive over-indebtedness in the USA, UK, Europe, and China, and above all, remember that our government is on the hook to bail out our Too Big To Fail ponzi banks.

Just like everyone else.

The list of countries that have already stolen citizens’ super to finance government spending, includes some that won’t surprise you (Argentina, Bolivia, Hungary, Ireland, and more), and others that might shock you (USA, UK, France).

If you have not familiarised yourself with the ever-growing global trend of government theft of citizens’ super, and especially the evidence that the first steps have already begun here too, then I urge you to read some of my many previous articles on this topic:

It Has Begun – Labor Steals Liberal’s Idea To Steal Your Super

Labor Begins To Steal Your Super

Stealing Our Super – I DARE You To Ignore This Now

Now The UK Government Is Stealing Super Too

RBA Says Our Banks Are Stuffed … In Other Words

Our Banks Racing Towards A “Bigger Armageddon”

Why They Are Planning To Steal Our Super, Explained In 4 Simple Charts

Fresh Evidence Our Banks In “Race To The Bottom” Means You Can Kiss Your Super Goodbye

No Super For You!!

“Grand Theft Pēnsiō – Europe’s ‘Economic Superstar’ Steals 5% Of Private Super Funds”

A very wise man said long ago, that “the borrower is the servant to the lender”.

Thanks to our foolish willingness to accept the Big Lie that debt is a “necessary evil” (it’s not), not just citizens, but entire nations, are now rendered servants to obey.

Slaves to bankers.

It Has Begun – Labor Steals Liberal’s Idea To Steal Your Super

27 Sep

Ever heard of the ATO’s “Small Business Superannuation Clearing House”?

You have now.

It’s new.

And it is a title that should make the hairs on the back of your neck stand up.

Because what it is, is the beginning of the end of your chances of ever seeing all of your super.

Or possibly … worst case scenario, but ever the more likely the younger you are … the beginning of the end of your chances of ever seeing any of it.

Exactly as predicted and forewarned by this very blog for months now.

Your humble blogger found a very interesting letter in his In tray on arriving at work yesterday.

From the Australian Tax Office (ATO).

It is proof positive of what I have been repeatedly warning readers is coming, in our near future.

Our government … both “sides” … are planning to steal our super.

There is something particularly interesting about this letter (copy below) from the Australian Tax Office to my own small business.  It proves that the Green-Labor government are now going to steal your super by means of a policy idea that they have stolen from the Liberal Party.

Yes, that’s right.

The lazy incompetent useless public-trough-swilling bastards presently “running” our country (into the ground) can’t even come up with an original way to thieve and pillage your retirement savings – so they’ve resorted to stealing a Liberal Party plan instead.

That story was broken right here on barnabyisright.com on June 7th, just 4 days after the Liberal Party quietly announced it as their policy – “Liberal Party’s Sneaky Plan To Steal Your Super To Pay Labor’s Debt”.

I strongly urge you to first read the article linked above.

And for a full background of a world in which governments across the globe – including the USA, UK, France, Ireland, and many more – are all sneakily stealing their citizens’ super, please read “Stealing Our Super – I DARE You To Ignore This Now”.

It will help you to be properly prepared for today’s shock news.

Finished? You now understand what is happening in the big bad world of superannuation theft, and what the Liberal Party’s sneaky plan is?

Good.

Read on, dear reader, for clear evidence of why you simply cannot trust either “side” of politics in this country:

(Click to enlarge)

Get the picture?

The government’s new Small Business Superannuation Clearing House is an ATO department. The government plans to have your employer send your superannuation directly to their ATO “Clearing House” … not directly to your super fund, as it is now.

It’s all so well-intentioned, you know. Really. It’s all so very innocent … a “helpful” “reform”, only intended to save your boss time and hassle, of course.

And this is unquestionably a Liberal Party policy.

The only difference, is that the ALP’s version of this policy to steal your super is … surprise surprise … less efficient than the Liberal’s version.

Because the Liberal’s version planned to encourage employers to send your super to the ATO, along with their quarterly GST (BAS) payment. Your super, and their GST.  All in one easy payment … to the ATO. That’s Liberal Party efficiency for you.

By using the deceitful disguise of a great “helpful” “reform” to “cut red tape” for small business, the Liberal’s policy sneaks under the radar with the attractive appeal of killing two birds with one stone … saving the employer even more time and hassle.

And both sides of politics present their sneaky scheme scam to steal your super using exactly the same kind of warm and fuzzy, butter-wouldn’t-melt-in-our-mouths and you-can-trust-us-we-wouldn’t-harm-a-fly language style.

Check out the Orwellian language of the ALP’s letter from the ATO announcing this wonderful new scheme:

Are you a small business or organisation with fewer than twenty employees?

If so, you are eligible to use the Small Business Superannuation Clearing House (Clearing House).

This service offers a number of benefits to small businesses as:

  • it is free
  • it is simple to use
  • it reduces the time and paper work involved in making multiple payments to different superannuation funds and
  • it helps you meet your superannuation guarantee obligations.

Arrrrrrgggghhh! Am I in the presence of one of those pathetic spruikers standing outside a low-rent retail shop wearing a gaudy suit and brandishing a microphone whilst annoying the passersby? I think I’m drowning in snake oil!

This is pure propaganda – the doublespeak language of perception management. It is remarkably akin to that used in those patheticly transparent Readers Digest-style junk mail scams – “Congratulations, you are eligible to win a mansion on the Gold Coast … just send your money here.”

I’m “eligible” to use this wonderful new service of the ATO?  Wow! I feel so blessed, so honoured, to be a chosen one.

Now compare to the Orwellian language of the Liberal Party’s policy announcement back on June 3rd … starting with the Orwellian title –

Further relief for small businesses

For small business men and women, less paperwork means higher profits, boosted sales and more time with the family.

If we want stronger and more cohesive communities, we need stronger and more prosperous businesses: …

Oh wow! Yes please Mr Abbott! I want relief from the terrible burden of conscientiously looking after the best interests of my wonderful, hard-working, loyal employees, who are really more like family … I really really do!

How could we employers not all leap and dance with exultant rejoicing about that!

All that terribly challenging and time consuming “red tape” work … of clicking “print” and printing off several different envelope address labels to different super funds (or sacre bleu! hand writing each one!!) … once every 3 months … saved!

Now, all thanks to our wise and caring government, we employers can just print one envelope every 3 months. Make one electronic funds transfer.

And send all your super, dear employed reader, straight to the ATO.

Naturally, we can all completely trust the ATO to pass it all on immediately to your super fund.

And not, perchance, happen to sit on those tens of billions per quarter for (let’s say) a few weeks, and thus siphon off some short-term money-market interest for themselves first.

Yes, oh yes, dear reader … of course we can trust the ATO to do the right thing with your super.

Just like we can trust Green-Labor and the Liberals not to cast their greedy eyes over Australia’s existing $1.3 Trillion pool of citizens’ superannuation, and concoct oh so reasonable-sounding, “helpful” “reforms” that just happen to steer your retirement savings into their own coffers.

To pay down the debts they have accrued.

To fund their lavish, all-expenses-paid, high flyer lifestyles.

And … to finance their index-linked, high 6-figure retirement in the lap of luxury, after they’re done ruining the country for all the “little people”.

The new ATO “Small Business Superannuation Clearing House.

Oh, yes. It’ll be “clearing” out your super all right.

Don’t you worry about that.

Here’s roughly how it will go, dear reader.

Mark my words.

Stage 1 – it’s already here … a “helpful” option, just for small business (who employ 60% of all Australian workers).

Stage 2 – this “helpful” option extended to include larger businesses.

Stage 3 – the option is no longer an option.

Stage 4 – a financial crisis or other plausible-sounding excuse is used to justify compulsory acquisition of some (or all) of your super. Exactly like what has already happened in the USA, UK, Ireland, France et al. Once again, it will be touted loudly by our political overlords as a “helpful” “reform” … perhaps to “preserve” what is left of your super after another market crash, via putting your super into a (compulsory) “government-guaranteed” “safe” “investment”.

Drip drip drip drip.

Fabian socialist tactics at their finest.

And most obvious.

WAKE UP AUSTRALIA.

It’s long past time for real change in our political system.

Beginning with … bringing to an end the entrenched “Two Major Party” political system.

A perverse system that is ably supported and sustained by its lifeblood – our wholly undemocratic compulsory voting system.

(Achtung! You vill vote in our vonderful “free” and “open” democracy, dear reader … yes, you vill. ‘Coz if you do not vote for one of de useless self-serving cretins that our taxpayer-financed party machines offer you as “choice” in your electorate, then ve vill fine your miserable arse … and ve vill throw you in der cooler if you don’t pay!)

There is a way to change the system, dear reader.

And your humble blogger will have more news on how you can get involved in making it happen … soon.

Grand Theft Pēnsiō – French Edition

2 Jun

Continuing our recent peek into the world of government confiscations of citizens’ superannuation, we find that France too is indulging in grand theft.

From eFinancialNews:

France seizes €36bn of pension assets

Asset managers will have the chance to get billions of euros in mandates in the next few months for the €36bn Fonds de Réserve pour les Retraites (FRR), the French reserve pension fund, after the French parliament last week passed a law to use its assets to pay off the debts of France’s welfare system.

The move reflects a willingness by governments to use long-term assets to fill short-term deficits, including Ireland’s announcement last week that it would use the country’s €24bn National Pensions Reserve Fund “to support the exchequer’s funding programme” and Hungary’s bid to claw $15bn of private pension funds back to the state system.

Think our government would never resort to stealing your super to pay down its debts?

Think again.

So far we have found that Argentina, Hungary, Bolivia, Poland, Ireland, France, and now the mighty USA have all either confiscated or “borrowed” their citizens’ retirement money to pay for government debt problems.

And our very own Senator Barnaby Joyce has given early warning of the same thing happening right here in Australia:

Of course, the public servants will not be happy when we use their retirement savings, put aside in the Future Fund, to pay off some of Labor’s massive debt.

Learn more about the growing trend for governments to steal your retirement savings, in these earlier articles:

“No Super For You!”

“Grand Theft Pēnsiō”

“Grand Theft Pēnsiō – Europe’s ‘Economic Superstar’ Steals 5% Of Private Super Funds”

No Super For You!

18 May


What will you do when they take away your super?

From the Washington Post, 17 May 2011:

Treasury to tap pensions to help fund government

The Obama administration will begin to tap federal retiree programs to help fund operations after the government lost its ability Monday to borrow more money from the public, adding urgency to efforts in Washington to fashion a compromise over the debt.

Treasury Secretary Timothy F. Geithner has warned for months that the government would soon hit the $14.3 trillion debt ceiling — a legal limit on how much it can borrow. With that limit reached Monday, Geithner is undertaking special measures in an effort to postpone the day when he will no longer have enough funds to pay all of the government’s bills.

Geithner, who has already suspended a program that helps state and local government manage their finances, will begin to borrow from retirement funds for federal workers.

The USA is taking public servants’ pension funds, to pay government bills.

Note that well.

Because last week, Senator Joyce made a very disturbing revelation (below).

Think it could only happen in America?

From Reuters, 21 October 2008:

Argentina’s center-left President Cristina Fernandez on Tuesday signed a bill for a government takeover of the $30 billion private pension system in a daring and unexpected move that rocked domestic markets.

From Bloomberg, 26 November 2010:

Hungary is giving its citizens an ultimatum: move your private-pension fund assets to the state or lose your state pension.

Economy Minister Gyorgy Matolcsy announced the policy yesterday, escalating a government drive to bring 3 trillion forint ($14.6 billion) of privately managed pension assets under state control to reduce the budget deficit and public debt. Workers who opt against returning to the state system stand to lose 70 percent of their pension claim.

“This is effectively a nationalization of private pension funds,” David Nemeth, an economist at ING Groep NV in Budapest, said in a phone interview. “It’s the nightmare scenario.”

But Argentina and Hungary are not like us, right?  That couldn’t ever happen in a mid-level “advanced economy” like ours … right?

From Business Insider, one week ago:

Irish Bombshell: Government Raids PRIVATE Pensions To Pay For Spending

But the Irish had a big housing bubble, didn’t they?  No way anything like that could happen here … right?

From the Sydney Morning Herald, 4 March 2011:

Australian house prices remain the most overvalued in the world, according to the latest quarterly ranking of global house prices by The Economist magazine.

But our housing market could never fall.  Not like it did for Ireland … or the USA … or the UK … or Spain … right?

From AAP, 29 April 2011:

Capital city home prices have posted their biggest quarterly fall in at least 12 years, as more stock in the housing market allows prospective buyers to wait for bargains, a survey shows.

Capital city dwelling values fell by a seasonally adjusted 2.1 per cent in the first quarter of the year, according to the latest RP Data-Rismark Home Value Index.

The quarterly change was the steepest since the index series began in June 1999, RP Data research director Tim Lawless said.

And from the Sydney Morning Herald, yesterday:

Australian real estate, long the subject of global concern, bears all the symptoms of a market that simply has run out of puff.

Ever since America’s housing bubble burst in 2007, setting off a chain reaction in Britain and across Europe – which then infected the global financial system – international pundits have been warning of a similar catastrophe here.

Do you remember what our government did the last time our real estate market began to fall sharply?

It was during the 3-month peak of the GFC, in late 2008 / early 2009:

Steve Keen's Debtwatch

They guaranteed to use taxpayers’ future earnings to underwrite our banks’ trillions in foreign loans.  Poured $20 billion in borrowed money into Residential Mortgage-Backed Securities.  And borrowed billions more to prop up the housing market. By bribing thousands of young people into massive debt, thanks to the government’s double-trouble First Home Owners Grant.

If you think “it could never happen here”, if you think that our government would never take away your super to pay for its massively wasteful spending, then it’s time to think again.

Were you one of those who ridiculed Barnaby’s warning in late 2009, about the possibility of a US debt default?

It’s coming to pass right now.

So pay close heed to another prescient warning from Barnaby, given just one week ago:

On Tuesday night’s budget, Labor sneaked in an Amendment of the Commonwealth Inscribed Stock Act 1911. Here is the most telling statement for where our nation is going under this Green-Labor-Independent Alliance. Under Part 5 Section 18 subsection 1 “omitting ‘$75’ and substituting ‘250’ ”.

Now that is in billions ladies and gentlemen and it is real money that really has to be paid back. If we have all this money stashed away under the lower net debt figure that is always quoted by Labor, then why not use some of this mystery money to pay off what we owe to the Chinese and others who we are hocked up to the eyeballs to.

The reason why we can’t is at least $70 billion that makes up ‘net’ debt is tied up in the Future Fund and student loans.

Of course, the public servants will not be happy when we use their retirement savings, put aside in the Future Fund, to pay off some of Labor’s massive debt.

!??!

That is exactly what is happening in America.  Right now.

And Barnaby is warning that it could happen here too.

The first steps in that direction have already begun.

From Global Custodian (Australia edition), 11 May 2011:

The Gillard government’s 2011-12 budget has proposed a raft of initiatives aimed at encouraging superannuation fund and private investment in infrastructure projects.

In light of the botched “school halls” program, and the stalled white elephant NBN – which so far has only achieved a 12% takeup rate, versus their predicted 58% –  would you really trust this government to wisely and prudently invest your super in Government infrastructure?

Others have their doubts.

From The Australian, 12 May 2011:

The government’s plan to use tax incentives to encourage superannuation funds to invest in new infrastructure could be thwarted by inadequate returns on projects and a reluctance by the states to take on project risk, experts say.

First, a little “encouragement” for super funds to invest in government spending programs.

Then, when the costs blow out, or when the government debt becomes unmanageable?

“No super for you!”

Barnaby is the only one on the ball.

This blog will be following this story of government confiscations of public and private retirement funds in future posts.

A final thought for now.

Yesterday I commented on the proposal that Australia should have an “independent” Carbon Bank (Our ‘Squeeze Pop’ Carbon Bank).  One that …

…could be allowed to borrow money to invest in renewable energy projects against the future revenue of Labor’s proposed carbon tax and emissions trading scheme.

In other words, a Carbon Bank where the government … meaning taxpayers … becomes the guarantor for any losses made on those “investments”.

Does that prospect concern you?

Can you see where this is all heading?

This is a government that has racked up nearly $200 Billion in gross debt.

Is running a “forecast” $50 Billion annual budget deficit.

Is presently borrowing at a rate of over $2 Billion per week.

And has now moved to raise our debt ceiling by another $50 Billion, to a new record quarter of a Trillion dollars.

This is the same government of completely unqualified economic incompetents behind a string of costly disasters – electrified ceiling insulation, overpriced school halls, “green scheme” rorts, the problem-plagued Nation Bankrupting Network … and now, free set-top boxes.

Do you honestly believe that this government would not end up burying taxpayers with even bigger losses from their carbon dioxide “air tax” scheme too?

Do you honestly believe that this government would never follow the lead of Argentina, Hungary, Ireland, and now the superpower USA … and steal your super to pay for massive debts that they have racked up?

These are just some of the many sound reasons why Senator Joyce has persistently tried to raise public awareness of the real and grave peril of ever-increasing Labor government debt and deficit, in a (supposedly) post-GFC world.

Your retirement savings depend upon your taking notice of his warnings.

Barnaby was right.

Barnaby is right.

UPDATE:

Labor’s PM-in-waiting, the Minister for Financial Services and Superannuation, Bill Shorten, already thinks of your super as a “significant national asset” … a kind of “sovereign wealth fund”.

From The Australian, 4 May 2011:

Superannuation is our sovereign wealth fund

This week marks 12 months exactly since the government announced plans to take compulsory superannuation from 9 per cent to 12 per cent.

… our superannuation savings place Australia fourth in the world. Its $1.3 trillion in funds under management through superannuation significantly boosts national savings and provides greater retirement security for millions of Australians. Superannuation is also a significant national asset because it strengthens our financial sector.

UPDATE 2:

About the USA’s new edition of Grand Theft Pēnsiō.

From ZeroHedge:

It’s Official: DTS Discloses Total Debt Hit Ceiling Yesterday; Government Draws On $14.3 Billion From Retirement Funds

%d bloggers like this: