Financial Crisis

If you ever find yourself envious of those who still have access to the classic defined benefit pension plan through an employer, it is worth remembering that they are not completely risk free. In the wake of the financial crisis, many employers are finding that their defined benefit pension plans are both underfunded and unsustainable. One natural course of action in response to this situation is filing for bankruptcy. In this situation, much of the value that has been promised to employees...

The Center for Retirement Research at Boston College maintains a national retirement index that measures the percentage of Americans who are at risk of being unable to maintain their standard of living in retirement. The most recent index results, which incorporate the impact of the financial crisis, reveal that 51 percent of Americans are at risk of being unable to maintain their standard of living in retirement. This is a 7 percent increase from the previous index results. Factors attributing...

Warren Buffett's first rule of investing is "don't lose money." His second rule is "don't forget rule number one." In a rather odd whitepaper on retirement planning titled "Risk: How Much is Enough," the financial services firm UBS lays-out a road map of sorts for "moving forward" with retirement planning "in a changed world." What seems clear is that the primary catalyst for the whitepaper is the fact that many financial advisors ignore or forget Buffett's first rule of investing when it comes...

In a very interesting piece of investigative journalism, Bloomberg is exploring the link between decisions made by the New York Fed under Treasury Secretary Timothy Geithner and billions of taxpayer dollars directed to select investment banks--including Goldman Sachs--at the height of the financial crisis in November 2008. Under Geithner's leadership, the New York Fed made a decision to reimburse several banks in full for counterparty positions in credit-default swaps with AIG. Bloomberg...

Barron's reports that U.S. investors have filed more securities arbitration claims in 2009 than in all of 2008. 4,991 claims have been filed thus far in 2009. Mandatory arbitration--which prevents a case from going straight to court--is essentially the sole recourse for investors who feel they have been harmed by a broker or advisor. The arbitration system is run by Finra , which serves as the self-regulation arm of the securities industry. The overall success rate of securities arbitration...