DMGBlaming the Most Vulnerable
This pisses me off. Economist Daniel Hamermesh loudly declares that if your retirement fund cratered this year, that's your fault because you should have known better than to be exposed to market volatility.
Except, the root of the current financial mess is that investment rating agencies were giving AAA ratings (nearly zero-risk) to investment isntruments that were downright risky. The experts all agreed that they were doing the right thing. The smart thing. (Now, it may be that "the smart thing" meant, "I get rich enough this year that I don't care what happens after that because I'll be splitting my time between Jackson Hole and Los Cabos.")
Are we all expected to become financial experts on par with professional investors? Seriously? Does Hamermesh understand that we have day jobs?
I completely believe in the advice every boxing ref gives the fighters: "Protect yourself at all times." Ultimately, your safety is your responsibility. Not the ref's, not the other fighter's. Yours.
But in order to do that, you need straight-forward, comprehensive, reliable information. And in a market fueled by information imbalances, that's incredibly difficult to come by.
Readers' Comments
Now, the half of my retirement that is in a CD is in tact and slowly growing.... And I *overfunded* the CD based on expert recommendations because I have a low tolerance to risk. I don't like the idea of losing my principle.
I feel bad for people close to retirement who lost a lot. Even if they had a lot in guaranteed accounts, but kept a bit in mutual funds or the stock market, that could seriously impact their retirement.