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The Number is Anti-American

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I talked about The Number by Lee Eisenberg on a number of different occasions, including an in-deplth look at the book in a five-part review. Here’s a fresh look at the “memoir,” written by Paul Farrell from MarketWatch:

Eisenberg’s book is an extremely entertaining read. I loved it… But in the end, the book is… a myth… That myth says somewhere out there is “The Number,” a magical mix of stocks and bonds and annuities and insurance and cash and gold and real estate and pensions that will make you feel safer, sleep sounder, feel more secure about your future.

The columnist believes that America can survive only if its people are Numberless. There is no Number out there. Some people get the Number, and here they are (from the article):

* Wall Street’s insiders split $21.5 billion in bonuses last year, while the stock market lost an average of almost 3% of your money annually the past five years.
* The compensation of Corporate America’s top executives continues to soar, while worker pensions and health-care insurance are cut and inflation eats away incomes.
* And in Washington, your elected representative and civil servants enjoy guaranteed pensions and health insurance and cater to shifty lobbyists like Jack Abramoff.

There is a lot of merit to some of Farrell’s points. By the time the regular saver’s portfolios reach $1,000,000 at retirement 40 years from now, a million bucks won’t go too far. Nevertheless, I think Farrell takes it too far.

Updated February 6, 2012 and originally published January 24, 2006. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 1 comment… read it below or add one }

avatar retireat30

I agree with the problem of influence brokers. They shouldn’t exist because they distort the political process (although if memory serves, Locke thought that money in politics was both inevitable and in the end OK).

However, I do take some exception with the other two points.

1) Wall street is not the stock market. They do thousands of tasks in the big investment banks, and only a fraction of them involve the stock market. They also manage bonds, underwrite stocks and bonds, in short perform the transactions that keep all financial markets (not just the S&P 500) working.

2) Sure many executives make millions of dollars a year, and certainly many of them are overcompensated, but not necessarily all of them. CEOs are generally very talented and capable people. If they were to ‘go it alone’ and leave the helms of their publicly traded companies I imagine they would, on the average, do better as owner-managers than they do as just managers. The downside would be that some of them would get filthy filthy rich and some would get filthy poor – I think it is a much more likely that they are accepting security over average higher pay (like bonds vs. stocks – one is more secure, the other is better on the average).

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