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The new plan to create a stock market portfolio for every child in America

cnbc.com

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Re: The new plan to create a stock market portfolio for every child in America

#11

Post by silisili »

huytersd wrote: post #4
oceanghost wrote: post #2

So the folks who own all the stocks want the government to bid up their assets?

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire syst…

This is another ponzi system like social security, that only works with an evergrowing population. These are not sustainable long term.

Re: The new plan to create a stock market portfolio for every child in America

#12

Post by sir0010010 »

silisili wrote: post #11
huytersd wrote: post #4

Earlier quoted context omitted.

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire syst…

This is another ponzi system like social security, that only works with an evergrowing population. These are not sustainable long term.

Also real estate with zoning laws and subsidized fixed rate 30 year mortgages in addition to social security and the stock market

Re: The new plan to create a stock market portfolio for every child in America

#14

Post by SturgeonsLaw »

Capitalism's equivalent of a crack dealer giving the first taste for free.

That said, sounds interesting. Gives kids a huge headstart for time in the market, builds financial literacy, provides broad inflows into the market pumping asset prices. Gives the next generation skin in the game.

If we accept the premise that market participation is a good thing, then this does seem to be, on balance, beneficial.

Re: The new plan to create a stock market portfolio for every child in America

#15

Post by antifa »

I'm seeing two completely different ideas in this article. "A stock portfolio for every child in the US" and "funding stock market portfolios for children of employees of Microsoft/Uber/Dell/Zillow". Are we talking about doing both?

It's an interesting idea, but it seems less likely to work and more likely to be a ponzi scheme or other type of scam than something like welfare reform, declaring basic food and housing a human right, then backing that with some reasonable policies. Most people might have to sell theirs to goto college or buy a car to drive to their first job I imagine. It's shivering with "K-shaped recovery" vibes.

At least, I'm confused about what problem it's attempting to solve here. Maybe it's not intended to solve a problem.

Re: The new plan to create a stock market portfolio for every child in America

#16

Post by xkekjrktllss »

t0mas88 wrote: post #5

Doesn't it increase inequality if the children of highly paid tech employees also get double the amount in their investment account compared to those born from poor parents? That feels like it's not aligned with the original idea of giving all children an investment account.

If you want a classless society, that's literally the definition of communism according to Karl Marx.

This is capitalism.

Re: The new plan to create a stock market portfolio for every child in America

#17

Post by notfromhere »

charlie0 wrote: post #8

Sounds like a plan to offset the massive withdrawals Boomers (or their heirs) are about to do (just like the opt out vs current opt in 401K), with the added bonus of the managers taking a nice 1%-2% off the top.

[flagged]

Re: The new plan to create a stock market portfolio for every child in America

#18

Post by jewayne »

silisili wrote: post #11
huytersd wrote: post #4

Earlier quoted context omitted.

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire syst…

This is another ponzi system like social security, that only works with an evergrowing population. These are not sustainable long term.

There's nothing inherently unsustainable about social security. If FICA tax revenues don't keep up with benefits, benefits can be cut to make up for the shortfall. If you haven't noticed, due to our still-falling life expectancy, we keep having to move armageddon day back. I think there are many in high places that worry insolvency may never come.

Re: The new plan to create a stock market portfolio for every child in America

#19

Post by silisili »

jewayne wrote: post #18
silisili wrote: post #11

Earlier quoted context omitted.

This is another ponzi system like social security, that only works with an evergrowing population. These are not sustainable long term.

There's nothing inherently unsustainable about social security. If FICA tax revenues don't keep up with benefits, benefits can be cut to make up for the shortfall. If you haven't noticed, due to our still-falling life expectancy, we keep having to move armageddon day back. I think there are many in high places that worry insolvency may never come.

It is unsustainable in its current form. Of course you can cut benefits, raise taxes, raise age, etc to extend it for however long it makes sense. But it was designed for an evergrowing number of taxpayers, who'd support those before them due to strength in numbers. But as the tax burden grows, more and more people are going to be against it. I don't expect the majority of Gen Z will ever see a penny of it. I'm not sure I will, either.

Re: The new plan to create a stock market portfolio for every child in America

#20

Post by jewayne »

silisili wrote: post #19
jewayne wrote: post #18

Earlier quoted context omitted.

There's nothing inherently unsustainable about social security. If FICA tax revenues don't keep up with benefits, benefits can be cut to make up for the shortfall. If you haven't noticed, due to our still-falling life expectancy, we keep having to move armageddon day back. I think there are many in high places that worry insolvency may never come.

It is unsustainable in its current form. Of course you can cut benefits, raise taxes, raise age, etc to extend it for however long it makes sense. But it was designed for an evergrowing number of taxpayers, who'd support those before them due to strength in numbers. But as the tax burden grows, more and more people are going to be against it. I don't expect the majority of Gen Z will ever see a penny of it. I'm not s…

If Gen Z never sees a penny from Social Security, it will be because of the loss of political will to protect Social Security as we know it. Which would only happen if this continuing misinformation campaign convinces the younger generations that they will never get anything from the program.

Social security can literally go on for centuries, just fine, as long as there is political will to keep it going.

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