Category Archives: General News

Forbes Magazine suggests MLM Business for Boomers!

Hey gang!  Here is an interesting article from Forbes magazine.  The author is an advocate for baby-boomers to consider starting their own MLM business, and discusses the pros and cons quite candidly.  It is a refreshing and positive article from a widely distributed source.  Not all major publications have always shared a positive opinion about our incredible industry, which makes this article a refreshing break from other articles I have come across.

These are powerful points to consider as you build a business that reaches ALL ages.   Enjoy the article!

God bless, Tim Marks

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Would You Join A Multi-Level Marketing Company for Retirement Income?

By Robert Laura

August 29, 2014

At some point in your life you’ve been pitched a multi-level marketing (MLM), direct selling, or network marketing business opportunity.  While the pitch varies from company to company, it basically promises a chance to ditch your 9-5 work schedule, be your own boss, and make lots of money while making new friends in the process.

It all sounds good on paper, yet there is a seemingly endless debate over whether these companies and programs are legitimate business opportunities or not, so I dug in and got the real scoop.  As a result, I believe that the entire industry is poised for explosive growth and can be one of the most significant solutions to America’s current retirement savings crisis.

Initially, that may sound like a bold statement, but it’s not if you understand retirement the way I do.  The reality is, making a successful transition into retirement has more to do with psychology than with money… and the same may hold true for multi-level and network marketing.

Don’t get me wrong, money has a role in retirement, but it’s not the primary one every one gives it.  Combine that concept with eye-opening statistics like AARP’s estimate that half of all baby boomers (76 million) are interested in starting a business and the makings of a massive trend are in place.

As far as the retirement saving crisis is concerned, more and more people are coming to terms with the fact that they probably aren’t going to be able to save enough money to just sit around and slowly deplete their nest egg from age 62 to 100.  With the average 50 year-old estimated to have less than $50,000 in retirement savings, there is an obvious need to find alternative ways to either save more or generate supplemental income starting now, and continuing throughout retirement.  Moving beyond just the dollars and cents, boomers are growing tired of feeling guilty or bad about their past savings habits and are interested in moving towards possible solutions.

Another growing reality that could benefit MLM and related businesses is the increasing number of baby boomers who are disenchanted with their current careers.  They’re worn-out from years of the corporate grind and don’t feel the connection between their job and the people it impacts outside their office walls or company grounds.  They’re shifting their focus from accumulating a giant nest egg to a desire to be part of something bigger and better… to have a positive effect on others… and working in retirement.  Facets of life that can be fulfilled with specific types of products and service available through some MLM or Direct selling opportunities.

MLM and direct selling programs also offer very low barriers into entrepreneurship, often providing training, support, and ample encouragement along the way.  As retirees begin to realize they need activities that keep them busy, relevant, in good health, and connected to others, the time, energy and cost to participate in these kinds of companies make them very appealing to large segments of the population caught up in these dynamics.

This is not a ringing endorsement for the entire industry.  Like any investment of time, money, and energy, people need to be aware of what they are getting into and do their homework.  That’s the primary reasons I began researching the topic by reaching out to regular everyday people involved in these types of businesses and who were willing to skip the hype and offer a transparent view of the programs and give their opinions as to whether this can be a realistic source of retirement income.

I initially spoke to a retired friend who said she joined a health and beauty direct selling company as a means of meeting new people. She had recently remarried and moved to a new location, so she combined the practice of meeting new people with making extra money.  After almost a decade in the business, she’s built a small niche business with family and friends despite switching to from one company to another competitor after three years.

She admits she doesn’t attend all of the company’s local meetings and goal-setting sessions because she’s not interested in becoming a top producer.  She just likes to use the business activity to keep busy (particularly in the winter) and use the extra money she earns to travel and spoil the grand kids.

Having studied the psychology and behavior of boomers, this example represents a major shift in my thinking about the industry.  I no longer perceive these types of opportunities as money-making pyramid schemes.  Instead, I now see it as a way to enhance many of the personal aspects of retirement that are rarely discussed let alone planned for, with the added benefit of supplementing other popular retirement income sources such as pension and social security.

Daria M. Brezinski Ph.D, a practicing psychologist and former marketing director for a multi-level marketing magazine, echoes these sentiments.  “Many people don’t realize that multi-level marketing companies are successful because they help people satisfy a number of important human needs, including feeling significant, having connections, learning something new, and making a difference.  I have heard people in network marketing say again and again, ‘I’m doing this because I’m meeting amazing people … making so many connections … and I feel so good about myself.’”

Dr. Brezinski’s point is well taken and easy to see practiced by popular network marketing companies.  Many MLM and NM companies tout a three-to-five year plan to attain freedom and wealth, yet many of the people running company meetings have been in the business for five or ten years and still haven’t left their full-time job or landed on easy street.  “As it turns out,” Dr. Brezinski notes, “when other human needs are being met, the members and consultants don’t focus solely on the financial aspects.”

Continuing my interviews, I challenged three others who are in the business to be straightforward, and prove to me that the process really works.  What I found was good, consistent business advice applicable to any new business.

Lorene Hochstetler, from Ohio, recommends keeping your current job while slowly making the transition into MLM.  She’s been able to replace her full-time income but explains, “It didn’t happen overnight, and I still work every day.  I am very disciplined with my business and wake up every day knowing what I have to do in order to succeed at this.  You have to treat it like a business and be willing to follow advice from others who have made it.” Tracy Willard of California began her MLM career out of necessity.  “Prior to getting involved in my business, I told my friends to never let me join one of those things… but when our family was hit by the mortgage crisis I had to do something different.”  She started her business with the intention some retirees may also find themselves.  “I started with the idea that I just needed to make my month easier.  My company helped me figure out what I needed to do in order to make an extra $500 per month.”

She reiterated a common theme I heard throughout the interviews.  “If you treat it like a hobby it won’t pay you like a business.”  She also acknowledged that, in spite of her success, she doesn’t sit around eating bonbons every day waiting for residual checks to hit the mailbox.  “That’s a common misconception,” she said.  “I work hard at my business every day, although it doesn’t always feel like work.  Similar to other entrepreneurs who profit from their passion, she says “It’s rewarding because I found a product that has made in difference in how I look and feel… and I love selling it and helping other people start a business.”

Staci Cahill runs her Washington MLM company in a way many people can appreciate.  She keeps her personal life separate from her business life by avoiding home parties, offering instead workshops that educate prospects on the products she offers.  “I didn’t want to be that person others hid from because they thought I was going to ask them to host a party.  I like to keep my business life and personal life separate.”

When I asked her if she was successful at her craft, she pointed out an MLM approach different from what many might expect.  “Yes, I am very successful given what I wanted to get out of it.  I’m a single mother who used to work 50 hours per week outside the home.  Now I’ve cut it to 20 hours, which is a major upgrade for me and my family.”

As a five-year veteran of MLM, she attributes her success to the fact that, “I switched companies a few years ago once I realized that pots and pans don’t change people lives.  The products I now offer has changed my life and that of others… and I find a lot of value in waking up and going to bed knowing that.”

The interviews and psychological connections lead me to conclude that MLM and NM companies, along with other small businesses opportunities, are important considerations for anyone entering retirement.  In fact, I believe the concept of starting a business for retirement income will become one of the most significant trends impacting retirement in the 21st century.  But it has to start with redefining entrepreneurship and framing it into a retirement lifestyle.  That means helping people find ways to turn a passion, hobby, or personal desire into extra money in their pocket… not to mention helping people see the importance of  planning for the non-financial aspects of retirement such as replacing a work identity, staying relevant and connected, as well as keeping mentally and physically fit.

Something multi-level marketing as well as network marketing companies are poised to capitalize on.  As a result, the industry could soon experience larger than life growth, spurred by baby boomers looking to adjust their retirement feelings and plans.

 

Futsal Players: Mastering Their Craft

I am re-reading The Talent Code by author Daniel Coyle.  It gives the example of how the Brazilians dominate in soccer; in no small part because they’ve found a way to train their players before the youngsters even begin playing the sport.  Many of the kids never even step foot on a grass field until they are 14-15 years old. Quite strategically, they’ve been honing their craft using another game called futsal.

Futsal is different from soccer in several ways.  It is played on a smaller playing field, so a competitor is always in the players face, thereby increasing the intensity and competitiveness of the game.  It is played on a concrete or wood floor, not a grass field.  The biggest difference, though, between futsal and soccer is that futsal uses a smaller and heavier ball.  Why is this important?  Because the players can’t kick the ball down the field away from themselves; they must learn to control and manipulate the ball to a much higher degree than is demanded of them during normal soccer play.  As author Daniel Coyle says in his blog, thetalentcode.com,

“Futbol de salao [“futsal”] develops skill circuits far faster than the outdoor game, because players:

  • Touch the ball more often—600 percent more often, according to one study. More touches—in other words, more circuit-firings—creates more skill.
  • Are forced to develop more moves. Merely booting the ball down the field—often the first option in the outdoor game—doesn’t work. Futbol de salao players practice lots of fakes and tricks—because they have to. As one Brazilian told me, “Futsal is our national laboratory of improvisation.”
  • Grow accustomed to operating in tight spaces. When they get to the outdoor game, futsal players feel as if they have all the room in the world.”

So futsal players learn ball handling, double coverage, etc., at an accelerated rate compared to normal soccer players.  Similar to a flight simulator, futsal players are forced to practice mission-critical skills and master them.

I challenge you to ask yourself the question: what could I do in my profession, my career, or my business, to prepare myself ahead of time so I’m ready when real challenges hit?  If you merely play at a comfortable level in life, you aren’t stretching and growing.  But I can promise you this: somewhere, your competitor is.

Enjoy this blog link and accompanying video of a young futsal player, John Farnworth, mastering his craft!

God Bless, Tim Marks

Biblical Friendship of David and Jonathan

Friendship is born at that moment when one man says to another: “What! You too? I thought that no one but myself . . .”
– CS Lewis
 
 
 
The Bible is full of friendships.  We can learn a lot about ourselves and our own relationships by looking at those in the Bible.
 
In this article, and my next one, I’ll be looking at some of the most famous biblical friendships ever. As you’re reading the Bible this week, why not look out for some of the friendships and relationships described there. What things in those relationships are similar to your life? What can we learn about God from them?

David and Jonathan – They Should Have Been Enemies

One of the most famous friendships of the Bible has to be that of David and Jonathan. When they met, David had been chosen by God to be the future king of the Israelites, but Jonathan’s father (Saul) who was the king at the time, wanted to kill David.

However, Jonathan took a real liking to David.  He made a promise to him, he loved him, he gave him presents and provided for him. He warned David about plots against him by his father, he spoke out for him to his father and he used his influence to keep him safe.
Friendship Requires Self-Sacrifice
It’s not surprising that Jonathan was the main player in the relationship at first, because as the son of the king, he was the one with the power in this relationship.
 
But it is a power that he used for the good of his friend – and at a cost to himself. Every time he kept David safe or promoted his interests, he was destroying his own chances of inheriting his father’s throne. Jonathan’s friendship with David was at the cost of his own career and reputation!
Friendship Requires Loyalty
Jonathan was a friend with some pretty impressive qualities. His loyalty to David, and courage in the face of political pressure, and an angry, murderous father was unquestioned. He had the humility to say openly that he would never be king. He followed up his commitments, he was generous and he did it all ‘before the Lord’. He showed genuine affection, loyalty and openness. He was the friend everyone would love to have!
But David was not just a passive ‘taker’ in all of this either. As time went on their friendship grew so that by the end it was definitely a two-way relationship between equals.  When the pair had to part, the story says that David ‘wept the most.’ At Jonathan’s death, David showed immense grief.
Friendship Requires Real Commitment
One of the particularly beautiful aspects of this friendship was the way David and Jonathan promised to do good to each others family and descendents. They knew that as technical rivals to the same throne, it was more than likely that their families and heirs could grow to hate each other and try to eliminate their opponents. They took steps to stop the cycle of rivalry and hate – and as time went on, it worked!
Jonathan and David’s friendship has a lot to teach us about power, self-sacrifice and loyalty.
How do you treat your friends?
Most of us today are unlikely to be in a situation where we become best friends with our greatest rivals, but we may stand to lose status, money or power because of a friendship. Are we willing to put our friends first?  I hope so.
God Bless,
Tim Marks

Are You Left, Right, or In the Middle?

Over years of a self-directed education, having read many books on a variety of topics including history and politics, I always try to step back and look at the facts as they are and not as I want them to be.   With that in mind, I’d like to share a video from Edward Griffin, an excellent researcher and historian.  I don’t agree with him on everything, but he offers some thought-provoking insights on our political parties.
In this clip, Griffin shares a bone-chilling question that was asked by a university history professor who actually mentored William Clinton while he was a student (a question that is the opposite of what I personally stand for.)  The question asked was:
“How do you let people think they are directing their own political destiny, while at the same time we, the elite, are [actually] the ones  directing their political destiny, without them [the people] knowing it?”
The answer, once you hear it, will cast a light on the political charade we see in our government today.  Remember: we can’t make our world better until we understand it.
The video below casts light on things many of us have wondered or felt from time to time, and answers some questions about why we are stuck as a country and not following any one party’s “agenda” but really following an agenda we are not even aware of.   Enjoy the video!
God bless,
Tim Marks

US Graduate Students Disillusioned with Job Prospects

Hey gang!  A friend passed on this article from the New York Daily News and I wanted to share it with you.  It’s shocking to consider how few students graduate and find a job (40% of graduates of unemployed), let alone a job that meets their salary expectations (1/3 make less than $25,000 their first year) let alone in the field that they actually studied for (just over half of students.)

And yet, despite these abysmal results, people still believe that burying themselves in debt to get a college education is the BEST path to success!   Well, frankly I think we should be more impressed with ourselves for getting results (having a successful career or owning a successful business) over merely studying to get results.

Here is the article in it’s entirety.

God Bless, Tim Marks

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Today’s students graduate from college with heavy debts, and many aren’t reaping the benefits of that education — a poll shows recent grads often find jobs that don’t require a college degree. More than 40% are unemployed, and 16% are in part-time positions, a poll released on Tuesday showed.

 

The online survey of 1,050 workers who finished school in the past two years and 1,010 who will receive their degree in 2013 also found that many graduates, some heavily in debt because of the cost of their education, say they are in jobs that do not require a college degree.

 

Thirty-four percent said they had student loans of $30,000 or less, while 17 percent owed between $30,000 to $50,000.

 

“For our nation’s youngest workers, as well as for the workforce at large, there is a real need for employers to reexamine how they hire, train and develop their employees,” said Katherine Lavelle, of the global management consulting firm Accenture, which conducted the survey.

 

Nearly half, 42 percent, of recent graduates expect they will need an advanced degree to further their career and almost a quarter are already planning to take graduate courses.

 

More than half of graduates said it was difficult finding a job, but 39 percent were employed by the time they left college. Sixty eight percent said they are working full time, while 16 percent are in part-time positions.

 

The top industries that graduates wanted to work in were education, media and entertainment and healthcare.

 

Just over half, 53 percent, of graduates found full-time jobs in their field of study.

In addition to being underemployed many graduates thought they would have done better in the job market if they had studied a different major, and more than half also intended to go back to school within the next five years.

 

The survey uncovered a gap between what students expect to earn in their first job and their actual salary. Only 15 percent of this year’s graduates think they will earn less than $25,000 but a third of recent graduates said they make that amount or less.

Is The United States On The Same Path As Rome?

Edward Gibbon ( 1737-1794) wrote on this topic a couple hundred years ago in his book, The Five Marks of the Roman Decaying CultureIn it he breaks down the fall of Ancient Rome to five basic areas that are concerning (or should be) to us today as we look at our country and current status.  These five basic areas of decline were:

 

(1). Concern with displaying affluence instead of building wealth.   How does that compare to America today?  Let me just say, “car payment.”

(2). Obsession with sex and perversions of sex.  Sad to say that many advertising companies use sex to sell a product that has nothing to do with sex, from soft drinks to automobiles.

(3). Art becomes freakish and sensationalistic instead of creative and original.  I have been to Europe a few times and see a massive difference between “art” and well what we have today.  Keep in mind that Gibbon lived in 1700s so “freakishness” was different then.   He would likely had a heart attack seeing a crucifix in a jar of urine being called art, even though he wasn’t Christian.

(4). Widening disparity between very rich and very poor.  This is getting worse each decade and it doesn’t matter which president is in office.

(5). Increased demand to live off the state.  There are 11 states right now that have more people living off welfare than working.  Welfare pays more than $15 per hour in 13 states.

Gibbon argued that since Christianity created a belief that a better life existed after death, it fostered an indifference to the present among Roman citizens, thus sapping their desire to sacrifice for the Empire.  He also believed that Christianity’s comparative pacifism tended to hamper the traditional Roman martial spirit. Finally, like other Enlightenment thinkers, Gibbon held in contempt the Middle Ages as a priest-ridden, superstitious dark age.  It was not until his own age of reason and rational thought, it was believed, that human history could resume its progress.

It is laughable that Gibbon would write this!  Obviously he was not familiar with scripture ( he was not Christian) because if he did read the scriptures he would find that God not only instructs but demands that Christians work hard here on earth, but would also be forbidden to worship Rome.

I was obviously not there during Roman times (though my kids think I’m old enough) so I can’t say if the “Christians” were pacifists and stopped working and started waiting for the after life, but if they did, that type of attitude is not based on scripture.  I’m aware of about 70 verses in the old and new testament on working and work ethic; never does God tell us to “not work” except on one day a week.  So if Gibbon wanted to argue Christians contributed to the fall of Rome the fact that they only worship one God (God of the Bible) should have been the direction he went.
However, if Christianity was part of the problem, one has a hard time explaining how the United States of America became larger than Rome and more wealthy being based largely on Judeo-Christian principles and work ethic.
I don’t think Gibbon gets it all wrong; as a matter of fact, he gets more right than wrong. One major point that many historians either disagree on or won’t talk about is the ever expanding military and how Romes army was busy out “expanding the Empire.” Today we call it “spreading Democracy” even though we are a Republic (or used to be.)

The fall of Rome started somewhere around AD 190. The Roman Empire was attacked by tribes such as the Goths and the Vandals (I guess they also suffered from holes in border security?!)  Civil wars in parts of Rome also weakened the rule of Rome and respect for Roman law declined as a result.

Tribes such as the Goths wanted to move south to obtain better farmland. At about AD 190, Rome also experienced a succession of emperors that were not capable of leading the Empire (sounds familiar.)  As Dr Ben Carsen says,  “If we commit ourselves to reading, thus increasing our knowledge, only God limits how far we can go in this world.”  Unfortunately today most of our politicians are trained with one-track “conveyor belt education” type thinking and don’t read anything that doesn’t support their idea of truth there with missing it all together.

Check out this video and you decide.
God Bless, Tim Marks

To The Republic For Which It Stands

In some schools today, our kids are not even aware of what the pledge is or why we should know it.  As a Christian, (and not affiliated with any political party) ultimately I pledge my allegiance to God.  However, I think it’s indisputable that God has blessed this nation and given the men who founded it some simple ideals to stay true to that which made the United States great.

“I pledge allegiance to the Flag of the United States of America, and to the Republic for which it stands, one Nation under God, indivisible, with liberty and justice for all.”

In the Pledge of Allegiance we all pledge allegiance to our Republic, not to a democracy. “Republic” is the proper description of our government, not “democracy.” I hear both Republican and Democrats say things like, “We need to spread democracy around the world.”  Why does it matter if we spread “democracy”? Or does it matter?

Watch this short video that explains the difference between a democracy and a republic and why it matters.

God Bless, Tim Marks

Facts on the Fourth of July

July 4th is a remarkable day for Americans and for the cause of freedom.  It is a day of great celebration for the birth of our nation, filled with parades, fireworks, speeches, and of course, readings of a great document.  As many Americans will tell you, the members of Congress famously signed the Declaration of Independence on this date in history.

Or did they?

In fact, they did not!  Many of the widely accepted “facts” surrounding the birth of our nation are errors that have been handed down from one generation to the next.  I thought it might be fun to share some of the interesting tidbits of history with you today.

In truth, historians now agree the Declaration was actually signed on August 2nd, 1776, not July 4th.

Leading up to the signing, on June 7th, 1776, Virginia delegate Richard Henry Lee introduced a motion calling for their independence from Britain.   Many American’s wanted to break away from British rule at the time.  It was suggested that Congress break for several weeks to draft a formal declaration, and a five-man team was appointed.  It fell upon Thomas Jefferson to draft the document.  Congress reconvened on July 1st, and motion was passed on July 2nd to break away from British rule.  The delegates voted almost unanimously to declare independence.  However, the actual Declaration of Independence was still being written!  Thomas Jefferson was hard at work on the document, revising it through July 3rd with edits and corrections being submitted by John Adams and Benjamin Franklin.  Even as late as the next morning of July 4th, Congress was deleting and revising large sections of the text.  Finally, on July 4th, 1776, the Declaration of Independence was complete and adopted by Congress.

So American’s celebrated Independence on July 4th, correct?  Nope!  In fact, it wasn’t until July 8th that Philadelphia organized the first celebration, complete with cannon fire and a parade.  George Washington got the news on July 9th and only then began celebrating with his troops, camped outside of New York, at that point.  Celebrations began as late into the summer as August 10th when the state of Georgia got the news (no Twitter announcements back then.)  In 1777, with the war raging, Philadelphia held the first (of what would become an) annual celebration of independence on July 4th.  Other states took notice and followed suit.  In 1781, Massachusetts made July 4th an official state holiday, and in 1870 Congress made July 4th an official Federal holiday for all Americans to celebrate.

Of interesting note: three American presidents have passed away on July 4th.  Both Thomas Jefferson and John Adams passed away within hours of one another on July 4th, 1826, the 50th anniversary of the adoption of the Declaration of Independence.  Additionally, James Munroe, the fifth president, passed away on July 4th, 1831.  And just to further commemorate the significance of the day, the 30th president of the United States, Calvin Coolidge was born on none other than July 4th, 1872.

Enjoy your Fourth of July!

God Bless, Tim Marks

It Would Only Happen in Poland, Not Here… RIGHT?!

Back in the early 1990’s I went to Warsaw, the capital city of    Poland (spelled Warszawa in Polish and pronounced VARS SHAVA)to design and open a manufacturing plant for the company I was working for here in the US.  The mother company here in the US went under a few years later but the plant we opened in Poland is still open today.  I can only assume the doors are still open because  some bankruptcy laws that we have  that don’t apply there, but I think the real reason is because the entrepreneur who was running the plant was and is hungry to keep it going at all costs.
You see when I went over there, communism was just recently on its way out and, for the first time in years, the people of Poland started to have hope that they could actually work and succeed.  Their success would be based on their efforts and the amount of time and money they invested in a business ( and really in the case of a former communist country, a job also.)  They were hopeful that this new success would allow them to put some money away in the bank or a retirement fund just like we do in the United States. I would guess that about half of the workers I talked to (via translator) seemed excited, while the other half just had a defeated look in their eyes that I will never forget, expressing the feeling of “there is no hope,  so why even try”?
It’s sad to say that the Polish people, who didn’t want to get their hopes up, may have been right all along because some of them did save and believed that could retire at some point just like we Americans do!

 

photoWell, in 2013 the plan started to change and the Polish government decided to “move some things around” to keep the doors open and once again the fine people of Poland, including those in Warzawa, are worried about the security of their retirement that they worked so hard for.

Please read the article below from Reuters and draw your own conclusions on weather or not a country with 17 trillion in debt may ” have to ” do the same?

Most Americans would say, “Oh, don’t worry – it could never happen here!”  Well, if we don’t want it to happen here, we can each do our part to take action and educate our countries.

God Bless,
Tim Marks

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WARSAW, Sept 4 (Reuters) – Poland said on Wednesday it will transfer to the state many of the assets held by private pension funds, slashing public debt but putting in doubt the future of the multi-billion-euro funds, many of them foreign-owned.

The changes went deeper than many in the market expected and could fuel investor concerns that the government is ditching some business-friendly policies to try to improve its flagging popularity with voters.

The Polish pension funds’ organisation said the changes may be unconstitutional because the government is taking private assets away from them without offering any compensation.

Announcing the long-awaited overhaul of state-guaranteed pensions, Prime Minister Donald Tusk said private funds within the state-guaranteed system would have their bond holdings transferred to a state pension vehicle, but keep their equity holdings.

He said that what remained in citizens’ pension pots in the private funds will be gradually transferred into the state vehicle over the last 10 years before savers hit retirement age.

The reform is “a decimation of the …(private pension fund) system to open up fiscal space for an easier life now for the government,” said Peter Attard Montalto of Nomura. “The government has an odd definition of private property given it claims this is not nationalisation.”

Tusk said people joining the pension system in the future would not be obliged to pay into the private part of the system. Depending on the finer points, this could mean still fewer assets in the private funds.

“The (current) system has turned out to be built in part on rising public debt and turned out to be a very costly system,” Tusk told a news conference.

“We believe that, apart from the positive consequence of this decision for public debt, pensions will also be safer.”

 

MARKET FEARS

By shifting some assets from the private funds into ZUS, the government can book those assets on the state balance sheet to offset public debt, giving it more scope to borrow and spend.

Finance Minister Jacek Rostowski said the changes will reduce public debt by about eight percent of gross domestic product (GDP).

This in turn, he said, would allow the lowering of two thresholds that deter the government from allowing debt to raise over 50 percent, and then 55 percent, of GDP. Public debt last year stood at 52.7 percent of GDP, according to the government’s own calculations.

The private funds hold assets worth about one fifth of Polish economic output and are among the biggest investors on the Warsaw bourse. Players in the pension market include international firms such as ING, Aviva, Axa , Generali and Allianz.

Bonds make up roughly half the private funds’ portfolios, with the rest company stocks.

Soon after Tusk unveiled his plans, the benchmark index on the Warsaw stock exchange was down 2.6 percent on the day.

“This is worse than many on the markets had feared,” a manager at one of the leading pension funds, who asked not to be identified, told Reuters.

“The devil is in the detail and we don’t yet know a lot about the mechanism of these changes, what benchmarks will be use to evaluate our performance… (It) looks like pension funds will lose a lot of flexibility in what they can invest.”

Polish officials have tried to reassure investors, saying the overhaul avoids the more radical options of taking both bond and equity assets away from the private funds outright.

They say the old system effectively made Polish public debt appear higher than it really is.

 

UNCERTAIN FUTURE FOR FUNDS

Poland has a hybrid pension system at the moment; mandatory contributions are made into both the state pension vehicle, known as ZUS, and the private funds, which are collectively known by the Polish acronym OFE.

The funds would effectively be left with only the equities portions of their assets, even this would be depleted, and there will be uncertainty about the number of new savers joining.

“This may lead to the private pension systems shutting down,” said Rafal Benecki of ING Bank Slaski.

Policy in Poland is still much more prudent than in many of its European peers. However, the reform could erode Poland’s reputation under Tusk for steady financial stewardship.

In the past few months, the opinion poll rating of Tusk’s Civic Platform party has, for the first time in years, slipped below that of the main opposition, the conservative Law and Justice Party.

Though the next election is not until 2015, some analysts believe electoral concerns are already influencing economic policy and pushing the government to find scope for spending.

http://www.reuters.com/article/2013/09/04/poland-pensions-idUSL6N0H02UV20130904

 

A Memorial Day Message

Hey gang!  Hope everyone has been enjoying this wonderful Memorial Day with family and friends.  I wanted to share a quick reminder of what today is really about.  While we are barbequing or enjoying a leisurely day off of work, let’s remember and salute the brave men and women in uniform who have served our country, risking their lives and sometimes giving their lives, so that we can enjoy our freedom.

However you celebrate this day, please remember how we have achieved our freedom and the people who helped make it possible.  And for those who fell in battle, let’s also remember to pray for the loved ones they left behind.  Here is a video to commemorate the day that I thought you’d enjoy.

God bless, Tim Marks

Government Dependence has Reached Epidemic Levels

We can only make a positive change if we study and understand history ( including  the Bible) and learn from it and work to implement the lessons in our own lives and teach them to others.
See the interesting image below from the Heritage Foundation and an excerpt of the article from End of the American Dream website that illustrates what most Americans feel every day, regardless of what the news channel says!
God Bless, Tim Marks
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18 Stats That Prove Government Dependence has Reached Epidemic Levels

Did you know that the number of Americans getting benefits from the federal government each month exceeds the number of full-time workers in the private sector by more than 60 million?  In other words, the number of people that are taking money out of the system is far greater than the number of people that are putting money into the system.  And did you know that nearly 70 percent of all of the money that the federal government spends goes toward entitlement and welfare programs?  When it comes to the transfer of wealth, nobody does it on a grander scale than the U.S. government.  Most of what the government does involves taking money from some people and giving it to other people.  In fact, at this point that is the primary function of the federal government.Just check out the chart below.  It comes from the Heritage Foundation, and it shows that 69 percent of all federal money is spent either on entitlements or on welfare programs…Heritage FoundationSo when people tell you that the main reason why we are being taxed into oblivion is so that we can “build roads” and provide “public services”, they are lying to you.  The main reason why the government taxes you so much is so that they can take your money and give it to someone else.

We have become a nation that is completely and totally addicted to government money.  The following are 18 stats that prove that government dependence has reached epidemic levels…

#1 According to an analysis of U.S. government numbers conducted by Terrence P. Jeffrey, there are 86 million full-time private sector workers in the United States paying taxes to support the government, and nearly 148 million Americans that are receiving benefits from the government each month.  How long can such a lopsided system possibly continue?

#2 Ten years ago, the number of women in the U.S. that had jobs outnumbered the number of women in the U.S. on food stamps by more than a 2 to 1 margin.  But now the number of women in the U.S. on food stamps actually exceeds the number of women that have jobs.

#3 The U.S. government has spent an astounding 3.7 trillion dollars on welfare programs over the past five years.

#4 Today, the federal government runs about 80 different “means-tested welfare programs”, and almost all of those programs have experienced substantial growth in recent years.

#5 Back in 1960, the ratio of social welfare benefits to salaries and wages was approximately 10 percent.  In the year 2000, the ratio of social welfare benefits to salaries and wages was approximately 21 percent.  Today, the ratio of social welfare benefits to salaries and wages is approximately 35 percent.

#6 While Barack Obama has been in the White House, the total number of Americans on food stamps has gone from 32 million to nearly 47 million.

#7 Back in the 1970s, about one out of every 50 Americans was on food stamps.  Today, about one out of every 6.5 Americans is on food stamps.

#8 It sounds crazy, but the number of Americans on food stamps now exceeds the entire population of the nation of Spain.

#9 According to one calculation, the number of Americans on food stamps is now greater than the combined populations of “Alaska, Arkansas, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.”

#10 According to a report from the Center for Immigration Studies, 43 percent of all immigrants that have been in the United States for at least 20 years are still on welfare.

#11 Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, more than 70 million Americans are on Medicaid, and it is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.