Rms said his friend said: “Don’t trust anything — even a formal contract.”
Wha? No ‘formal contract’ can get you money that just doesn’t exist. No court will order a debtor to pay a creditor beyond what he’s able to pay; because even if they did, the payment just won’t be made, dig? This method is almost as certain as physical law, like gravity.
Any fool with basic access to information 20 years ago could have seen the pension crisis coming. And yet, none of the actuaries, accountants, mathematicians and executives did. None of the people writing the policies and investment documents, did.
Well, not really, lots of them saw this coming, but either they were disregarded or they kept their traps shut and kept collecting the paychecks… and if any of their squawking reached the media, they continued to be disregarded or just called doomers. Anti-American. Chicken Littles. America keeps getting fooled into thinking there will always be plenty of money available to cover everything… while yearly, bankruptcies, foreclosures and other defaults deny this belief.
Rms’ friend still needs a reality check. He’s handing out the right advice, yes… but based on the wrong reasoning. You should always evaluate financial systems for their stability. You have to become a bit of a financial maven into your adulthood, to prepare for understanding which deals are good and which are bad. I was a skeptical lad myself when I went into the military at age 18, and due to that skepticism I always had money while the dolts around me ran out constantly. I spend, but not like they did, which even Darrel/Phoenix can’t complain about. I lived like the common sensibility of the 1970s Midwest told me to live, and it’s always served me… sadly, however, since it’s served me better while people around me lived like the common sensibility of the 2000s California, meaning they spent all their income and leveraged that income into lifelong debts. Their defaults have provided me with a lot of property and equipment that I’ve bought for dimes on the dollar.
I must say again: It’s not the fault of the contracts. Basic legal principles state clearly that contracts written in bad faith aren’t valid. That’s what all these pensions are: Contracts written in bad faith. So they must fail, and a lot more people should have not only seen this coming, but prepared for it.
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