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Page 69 of 72« First...102030676869707172
1995-2004

Intermediaries control corporate America

Decline in Direct Equity Ownership

The percentage of equities belonging to households and nonprofit corporations increased from 42.8% to 55.4% between December 1995 and December 2004.

Over 55% of the equity shares of US corporations which belong, in the final analysis, to US households and nonprofit organizations, are held indirectly through intermediaries, such as life insurance companies, private pension funds, government retirement funds, and mutual funds.

Retirement plans

What is the future of private pension plans?

Critical investment decisions in 'defined contribution' plans are made by unsophisticated workers.

Between 1999 and 2002, US private pension funds lost US$ 1.2 trillion in value. It would almost seem that pension fund managers had been speculating with retirement money, attempting to beat each others’ short-term performance statistics, with little interest in safeguarding the assets of plan beneficiaries.

Political intrusion and trade unionism have debilitated the pension fund industry over many generations. The end of the pension industry may now be in sight.

Retirement saving 2004

US households have trillions in IRAs

Growth of IRA Accounts

American households, as of December 2004, had accumulated $3,475.1 billion in tax-deferred Individual Retirement Accounts (IRAs), according to the Federal Reserve Flow of Funds Accounts.

The largest portion of these savings were held as “self-directed accounts”, in which a wide diversity of investment is permissible.

Over the four years, 1999 to 2002, investors added $837.2 billion to their IRAs, which, added to the $118 billion in decline in value over the period, means that the market crash cost IRA savers about $955 billion.

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Featured articles on inside pages

Stock buybacks

Accelerating to a buyback-option blowout

By Q1 2006, stock buybacks had multiplied to five times the level of 2000. Buybacks grew by 25% in 2005, with corporate profits after taxes increasing only 5.5%. At these rates, buybacks will exceed after-tax profits by 2009.
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Securities Analysis

Mark-to-market nonsense

Banks, by their nature, are insolvent, requiring government guarantees of their liabilities to protect against bank runs. Over the last fifty years, the percentage of bank liabilities guaranteed by the government has fallen considerably, while banks, free from the shackles of the Glass-Steagall Act, have become increasingly complex.
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US Politics

America grows with legal immigration

Legal immigration has resulted in solid growth of the US population, despite declining birth rates and an increasing number of old people. This is good news for investors in stocks and real estate. Illegal immigration appears to be less than 5% of legal immigration, and legal immigration is at an all time high.
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US equities

Stocks surge on spurious earnings

In Q1 2009, stock buybacks came back, driving up equity prices and sparking a rally by dominating a thin market. These equity repurchases were financed from depreciation reserves and bond issues. More ...

US Bonds

Bond demand exceeds supply for a decade

Over the decade, 1995-2004, the demand for US bonds of all types has surpassed new bond issues in eight of the last ten years. This is the reason that bond prices have held firm, even in 2003, when net new issues reached almost $1.8 trillion. More ...

World Economy

Signs of US losing its groove?

Thirty years ago, US income from abroad was more than double the amount of income that the US paid to the rest of the world. This year, or the next, this foreign income surplus may disappear forever. Is the US 'losing its groove'? More ...

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1969-12-31 19:00