Annuities ( Tick ... tick ... tick ...

On May 15, 2009, the geniuses who control our economy (Sec. Treasury, etc.) announced Insurance Companies can get TARP (US “giveaways”) funds to make up for the money they lost and stole and used to bribe politicians.

What does this mean?
It means that the US Government will "bail out" the Insurance companies. It means the Insurance companies are in deep trouble. It means they can’t meet their obligations. It means if you invested in an annuity or any other insurance product, you have big problems. It means that you may be the victim of a “scam”, Ponzi scheme, fraud or just plain stupidity.
It means $billions and $trillions more of taxpayer money will be given away. It means, if you are one of the few people who still pay taxes, your tax dollars will go to people (politicians, banks, Wall Street, insurance companies, lobbyists, etc.) who are destroying America.

What are Annuities?
Most “Annuities” are contracts between Insurance Company and an investor. The investor is a person/entity that puts in money. The Insurance Company usually promises to pay the investor/entity money in the future.

Most Annuities are advertised as “Insured”, “Guaranteed”, “A” rated, safe, etc.
Question: Who insures them, guarantees and rates them?
Answer: They insure themselves, guarantee themselves and pay Rating Agencies to rate them. (Hence, the insurance, guarantees, ratings, etc. are relatively meaningless.)

Question: Who regulates, oversees and monitors annuities?
Answer: In most cases Insurance Companies and annuities are regulated by the States.
Question: Who are the “Regulators”?
Answer: The Regulators are people from the Insurance Companies and people appointed by politicians after very generous bribes (donations, fees, etc.) from the Insurance Companies. They serve the Insurance companies and politicians, not the public.

Question: What happens to the money the investors/public put into annuities?
Answer: The Insurance Company is “supposed” to invest the money to generate a “rate of return” that will enable the Insurance Company to give the “promised” return to the investor/entity and a profit for the Insurance Company.
The “*assumed” investments are thought to be high quality and low risk bonds, Treasuries, mortgages, real estate, etc.

Question: What really happens to your money? Where does it go? Is it safe? Does it exist? Are their “books” audited? Are the investment assets held in a bank or brokerage firm or anywhere?
Answer: I don’t know. Information the Insurance Companies give (which is not happy information) cannot be believed. The State Politicians and Regulators and people in Washington cannot be believed or trusted. Maybe the money was abducted by aliens?

There is a great deal of suspicion that a large portion of the money invested in annuities is totally gone. Disappeared! In Swiss bank accounts or vaults or used to buy real estate in Costa Rica or Beijing. The money may be gone because of stupid investments, fraud, and theft or simply never invested in the first place.

Annuities are sold by Investment Firms, Banks, Financial Planners, Accountants, etc. and random crooks who can convince gullible people into giving them money. The people who sell you annuities get high fees (commissions, “kickbacks”, etc.) and don’t know or care what happens to your money.
Many suspect the annuity business is a huge Ponzi scheme. (The Insurance companies make payments using money from new investors.)

Is there a possibility that annuities are safe and secure and can pay their obligations?
Possible? Yes, probable, no!

Question: What should you do?

Answer: If you invested in an Annuity, demand to be given hard evidence of where your money is invested, protected and available on demand.
If you have any doubt, get your money out as soon as possible. Make sure you act fast. Once the flood of redemptions start, you will be much less likely to see your money again.

Think about it!

Also … Congress just passed credit card legislation which will speed up the expected “freeze”.
What should you do? (See “Goodbye Credit Cards” blog. April 27th, 2009)

Also … Most of our Federal and State legislators are acting to help with our economic crisis by increasing their salaries, “perks”, hiring more of their relatives and increasing their expense accounts and your taxes.

Are you paying your taxes?