Lehigh Valley Growth. Bah Humbug

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I say bah humbug to the explosive development going on throughout the Lehigh Valley. Who needs it. I sure don't.

More people means they need more jobs. More jobs more people. More, more, more of everything means.. Less fertile fields available for planting.
More schools means more taxes.
Less surplus water available.
With more people comes more crime.
With more crime comes more police funding needed.
Increased driver aggravation with bottlnecks and accidents

Indexing Social Security: What You Need to Know!

Repost From 2013

On April 18, 2013 the 'Congressional Budget Office' (CBO) came out with a report entitled,
Using the Chained CPI to Index
Social Security, Other Federal Programs,
and the Tax Code for Inflation

The whole concept of 'chained CPI indexing' assumes that by reducing Social Security payments seniors will buy alternative cheaper items and still be able to afford basic needs. However seniors' needs are different then most other age groups. The chart below represents a comparison over the last 30 years between two methods of calculating the effects of 'Chained CPI indexing. The one doesn't factor in seniors requiring different expense then the rest of the younger population. The other does. About 30% of those over 62 years of age rely on Social Security for 90% of their income while presently 13% of us as a nation are 65 years or older. So this is a big deal.

Overlooked is the elephant in the room. Seniors spend almost three times more on out-of-pocket health costs. Health costs which have risen disproportionately faster then the rest of ordinary inflation.

Chart Courtesy "The Ecnomic Policy Institute"

Everyone should readily see that those relying on Social Security for most of their income will not be able to find cheaper alternatives for their current healthcare coverage . Compounding this problem for them are the increasing monthly costs for Medicare and the supplemental plans coupled with ever decreasing Medicare payments to doctors, hospitals, nursing facilities as well as for medications.

Below is a chart for all 3 CPI methods of calculating future Social Security payments courtesy of The AARP

The GREEN is what Obama & Congress have in mind
The BLUE is the CPI adjusted specifically for seniors The CBO report mentions
(The latter being something I haven't heard either one of them discuss)

Here's Another Thought. Most seniors spend every dime of their retirement income which puts it right back into the economy. It isn't like they are taking their Social Security check and investing it for sometime in the future. So giving them a couple of bucks more to live on isn't as though the money won't be spent to help keep the economy growing. On the other hand if you take out $339.8 billion in total from changes in the program over the next 10 years, that's $339,800,000,000 less seniors have to pump back into the economy.
* * *

Some Highlights From THE CBO REPORT"The chained CPI grows more slowly than the traditional CPI does: an average of about 0.25 percentage points more slowly per year over the past decade. For example, if such a proposal took effect next year, Social Security benefits would be roughly $30 a month lower, on average, by 2023 than they would be under current law, representing a reduction of about 2 percent of average benefits

...The consumer price index reflects prices paid for the goods and services purchased by an average household, not by any specific individual or by the average person in certain age groups, income groups, or other categories. Therefore, most people experience price changes that are either higher or lower than reported in the CPI.... The possibility that the cost of living may grow at a different rate for the elderly than for the rest of the population is of particular concern in choosing a price index for Social Security COLAs because Social Security benefits are the main source of income for many older people....

... BLS computes an unofficial index that reflects the purchasing patterns of older people, called the experimental CPI for Americans 62 years of age and older (CPI-E). Since 1982 (the earliest date for which that index has been computed), annual inflation as measured by the CPI-E has been 0.2 percentage points higher, on average, than inflation as measured by the traditional CPI-U or the CPI-W.

... The longer-term difference between the growth rates of the CPI-E and CPI-U mainly reflects the fact that a larger percentage of spending by the elderly is for items whose prices rise especially quickly. In particular, compared with the overall population, the elderly devote a much larger percentage of their spending to medical care. That difference in spending patterns alone accounts for about half of the long-run difference between the CPI-E and the CPI-U.

... The CPI-E differs from the CPI-U only by using different percentage weights for the 211 categories of goods and services in the CPI market basket. For the CPI-E, BLS calculates those weights on the basis of the spending patterns of people ages 62 and older as observed in the Consumer Expenditure Survey, whereas for the CPI-U, BLS calculates expenditure weights on the basis of the spending patterns of all urban consumers in the survey.

Published on April 24, 2013

Drake Milligan - Cowgirl For Christmas

Transferring Money Slow As Molasses On Winter Day

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I notice when I charge something online my credit card records it in a matter of seconds. An alert is sent via email within a few minutes. Yet when I transfer money from one of my banks to another it takes up to seven days!

Why Is That?
Well according to Ben Steverman @ Bloomberg banks only transfer once a day at a certain time and only on regular business days. Whereas credit cards operate instantaneously 24/7/365. I'm sure banks are not too hot on changing this since according to the article banks make $30b annually in fees.

I imagine many people do not realize the differences between 'current balance' and that of the 'current balance available'. My bank no longer uses the word pending. Instead those two terms which can be a real gotcha'.

Budget.. Budget.. By All Means Budget !
This is why I'm very attentive to budgeting for bills well ahead of time. Failing to digest the fact the same bills come in the same time every month seems to be a way too common ailment among bill payers. Failing to take these transfer account times between banks into consideration is especially bad for someone like me who depends on the direct deposit from Social Security every month. My bank for several months creates the illusion I have a certain balance ('current balance') when it's actually still pending.

By not budgeting one's money it can put someone between a rock and a hard place. They have two choices. Pay the bill and hope the 'available balance' becomes available before the biller attempts to cash it. OR Let the bill slide until there's enough money actually available. Both are bad choices. If the money bounces a payer can get hit with both the $30 overdraft fees plus those of the biller. Letting it slide is a poor option as well. Payees will get hit with late fees and if it's a credit card could see their credit interests rates go up 10% or more.

The thing that ticks me off is having to wait up to 7 days (if it's a weekend) for banks to transfer my money, but if it's 1 minute after midnight (on the moneychangers end) you get hammered. Bankers' on the other hand doing their money trades on the market are measured in milliseconds. It's their game and they get to make the rules. The only option we are left with is to carefully plan ahead and budget wisely. There's simply no other tool available for consumers.

Why some people continue being surprised every month (year after year) by the same utility and credit card bills is beyond my comprehension.

No Cost Too Much To Keep Us Safe?

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The Navy called USS Zumwalt a warship Batman would drive. But at $800,000 per round, its ammo is too pricey to fire.
Ben Guarino | Washington Post

"The warship is the most expensive destroyer in the history of the Navy, costing about $4.4 billion.... the ship’s guns, reported to fire ammunition costing $800,000 a round."

A Matter Of PrioritiesThere's no way I wanna hear we can't afford Social Security or Medicare while we piss away this kind of money enabling defense contractors to get rich.

Why More People Watch TV Weather In Mexico Then The Middleast

Questions?
I Didn't Think So!