[sgarnett]

The Senate, UAW, et al, just gave up (ie failed) on reaching a compromise a few minutes ago.

I don't know how GM will come out after bankruptcy (they just hired the bankruptcy lawyer), but the stock market futures are looking ugly tonight. It actually held up well through some dismal recent employment numbers, but I suspect tomorrow is gonna be ugly. Rebuilding my retirement is going to mean austerity and no new cars for a very long time, and I suspect that will be true for many others. That can't be good for any automaker.

I'll admit I wasn't convinced that bridge loans to March could solve the problems for GM, so I don't claim to know what the right answer was. Nevertheless, this is going to be a big kick in the teeth for the economy.

This post has been edited by sgarnett: Dec 12 2008, 04:07 AM

[T.O.Dillinder]

Why would the average employee want a pension, which they can't control, versus a 401(k) or other retirement which they can control?

Pensions are a benefit given to an employee for length of service.
Length of service and the amount of a Pension is determined by the Company, unless it is a Unionized shop. In which case, the Union and the Company bargin primarily the amount of the pension.

20 years in the Military, 30 years for a Manufacturing employee are a couple of examples for length of service amounts.

Do you really have control of a 401K?
Correct me if I am wrong, but it is my understanding that a 401(K) is a type of Mutual Fund with those monies being used in the investments in the Stock Market.

A Salaried employee may have a Pension, and the value of the pension stated in his/her contract.

I am just going to say it is the fault of the Federal Reserve, Corporate Magistrates, and Politicians. In other words "THE MAN". (IMG:http://www.frrax.com/rrforum/style_emoticons/default/nutkick.gif)

[pknowles]

Why would the average employee want a pension, which they can't control, versus a 401(k) or other retirement which they can control?

Do you really have control of a 401K?
Correct me if I am wrong, but it is my understanding that a 401(K) is a type of Mutual Fund with those monies being used in the investments in the Stock Market.

The amount of control you have over your 401K depends on who you have it with. Most 401K's give you packages or general areas to invest in, but the individual stocks are determined by the handler. Some if not most 401K's give you the option to buy bonds instead of investing in the market. On average over years of time, the market out performs bonds by almost 2X, but bonds don't go down in amount (this is different than value because value is based on the strength of the dollar). There have been people speaking out wanting their 401K to be more like an e-trade account, where they can choose exactly what they invest in. I'm not sure if this exists yet, but I can see this being an option in the future for people that really follow the market. This allows the 401K handler to rake in the trading fees because you are locked into using them. Since 401K handlers are investment firms anyway this seems like a natural progression.

You get a pension and a 401K. I interviewed with ExxonMobil last year and they had the best pension and 401K matching program I've ever seen. They told me straight up that their focus was to retain experienced workers because their industry is so specialized, they can't buy experience in the oil industry where one small mistake costs millions of dollars.