What people are missing in the whole Detroit saga

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MemberSince99
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What people are missing in the whole Detroit saga

Postby MemberSince99 » Sat Jul 27, 2013 11:47 am

Whatever you might think of them declaring bankruptcy, or unions, as I read the posts from people cheering about this, I think you guys are totally missing a key fact here.

The fact you are missing is - you're next. What you say, that's ridiculous, I don't live in Detroit I have nothing to do with it. And that is true enough. However, Detroit promised to set aside pension funds for the retirement of these workers, and instead apparently squandered the money and is now broke. Think about this - the Federal government has also been taxing many of us for many years for retirement funds (called Social Security) and instead of investing it has squandered the money by putting it in the general fund and is in debt up to their eyeballs.

Are you connecting the dots here now? Many, maybe most of you, never expected to get anything back from that money anyway, so you might be thinking so what, this isn't news I expected to get screwed in the end. And if you're totally cool with that, well enjoy the screwing I guess, though I suspect it will be a dry run as lube costs money. But you might want to think about that next time you're tempted to cheer as the government lies and squanders money and tries to ditch the obligations it legally agreed to. You might enjoy seeing the union members get screwed but this government doesn't discriminate in the screwing - it will happily screw us all given half a chance. And we are all next, sooner or later.

Just food for thought.


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Postby Robrus1 » Sat Jul 27, 2013 12:28 pm

I'd opt out of Social Security given the choice. 34 years from now when I retire, I won't see any of the money I've been putting in and I know it. There's just nothing I can do about it, short of quitting my job and becoming homeless. That's why I'm putting back everything I can now. I want to be able to retire comfortably without factoring in social security so I'm pretending that it doesn't exist.
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Postby Midori » Sat Jul 27, 2013 1:03 pm

We've been buying fixer-upper SFH's, renovating, and renting them out for the last three years. I had read up on things for about 5+ years before DH came on board to actually give it a shot. (The thing that finally got him on board was finding that a successful friend of ours in Houston runs MFH's on the side.)

Trusting your investment property to a tenant is just as dangerous as anything else you could trust your money to. I had tenants bring in bedbugs on used furniture; I've had shop towels roto-rooted out of toilet lines; they let their spray-painted school projects roll paint around on every single carpet in a house. The best was when I had a tenant I was "working with" decide to do a midnight move-out, but his electricity was shut off, and he left candles unattended while he ferried away his first load, and it burned down the whole house.

So maybe that's not that inspirational after all... :oP There's a steep learning curve, that's for sure, and it's not for the weak of heart or weak of stomach. But at least I have a degree of control over my own investments' success or failure.

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Postby MemberSince99 » Sat Jul 27, 2013 4:24 pm

I'm still not down with getting screwed on that. It was bad enough the thieves on Wall Street got to award themselves big bonuses while my 401k disappeared and I ate that, but this is not an investment, this is a TAX. It's not optional to pay - they will put you in prison and I don't mean Club Fed for us mere peasants I mean the kind mentioned in the movie "Office Space" for messing with that.

So I'm just not down with getting ripped off on it. And it brings me no joy to watch as this city screws people out of promises they made to them and to know that will surely embolden the Feds to pull the same thing when this debt is no longer bearable. And I'm surprised we've made it this far without it exploding. I know how that goes because I was using one credit card to pay off another using cash advances when I got in over my head, and I can tell you from experience the end result of doing that - you are only postponing the inevitable. The only real difference is it was thousands instead of trillions and I couldn't simply decide to borrow more as no one would lend to me at that point (wisely I might add).

I am glad to see you guys are working on alternatives. I hope that works out for you.

I had thought of moving out of the country, if I could rely on that social security being there, but I don't entirely trust that. But then again when you're truly down and out it doesn't matter where you live, it is going to suck.

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Postby Jacksnow » Sun Jul 28, 2013 2:44 am

Okay, the issue is that with so many people moving out a lot of the pension guarantees were made in the heyday of Detroit, on top of that a lot of the "irresponsible" spending is going to support/welfare.


Detroit. Has. No. Money.


I don't mean where you're taking cash advances to pay them off I mean. No. Money at all.
They have to do this. Its a sacrifice that needs to be made for the city to survive. So either they cut the pensions or the welfare.

Pick one.

If that's unpalatable then you need to make people move back to Detroit invest in it start up businesses in it and stay there.

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djrez4
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Postby djrez4 » Sun Jul 28, 2013 9:48 am

Jacksnow wrote:Detroit. Has. No. Money.


They seem to have $450 million for a new hockey stadium...
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Postby Sevenfeet » Sun Jul 28, 2013 10:18 am

It's a little more complicated than that. Detroit also has less than half of its population from its salad days of the 1950s. There isn't a tax base left that can handle the past commitments...cities usually grow, not shrink. It's like Katrina in New Orleans, except the disaster was man made and happened slower (over decades). Combine that with poor decisions from city planners and outright graft (the last mayor went to jail) and you have an unavoidable situation.
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Postby Jacksnow » Sun Jul 28, 2013 9:50 pm

The 450 Mill is from stakeholders and other people, raised by the city for a specific project. That makes sense.

You can't raise money like that to cover your bills. And bond selling is a short term solution.

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Postby DoingHomework » Mon Jul 29, 2013 3:16 pm

The big difference is that the Federal government owns a printing press. It does not need to and cannot go bankrupt. Regardless of what the morons in Congress and on TV talk shows say, it is unconstitutional for the federal government not to pay its debts. Now, our foreign trade partners might refuse to continue trading with us and supporting us...and things could get very bad...but bankruptcy or default cannot happen.

We need federal laws that require locking up local officials who fail to balance their budget or who allow their city/state to default. I think that would lead to far more responsible behavior. Other countries have this, and even have it for board members of companies. It actually works!

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Postby djrez4 » Mon Jul 29, 2013 4:29 pm

Jacksnow wrote:The 450 Mill is from stakeholders and other people, raised by the city for a specific project. That makes sense.

You can't raise money like that to cover your bills. And bond selling is a short term solution.


You're wrong. Detroit taxpayers are paying 60% of the stadium bill. That's $261 million that should be going elsewhere.

When you're bankrupt as a city, you should be prioritizing the citizens - they're the ones who pay taxes to fund the municipality. Instead, pensioners and taxpayers will see benefits and services slashed so the owner of the Redwings (who also happens to have founded Little Caesars Pizza and is worth $2.7 billion) can get a new stadium subsidized. That's some rank-smelling BS, as far as I'm concerned.
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