People who have retired reasonably well have lost tremendous aggregate wealth that is represented by their savings and home equities. Perhaps some people who know elements of how older folk’s assets are handled can add to this, but the piece my wife and I have seen is a good start.

My wife is a veterinarian that does only bird and reptiles as a specialty, no dogs and cats. She has some very nice clients that we have gotten to know better through the years, and we have come to know a bit about people’s circumstances.

When the market took a dump in 2007/08 we saw two things that were highly disturbing. The first was the retirees she has as customers and one of the things that was happening to some of them, in fact that was happening to far too many of them, I can easily get a bit teary eyed thinking about it and have to take a break here and there, this was deeply upsetting to us. The ones that were hitting us hardest was the incredibly sweet people who had paid off their houses and had savings and investments north of $800k.

One guy was a retired pharmacist that was comfortable enough to be able to buy expensive fishing poles and reels from me as I did this as a hobby. He had his cash savings and retirement funds wiped out to where he had to go back to work part time to make ends meet, he ended up selling his home in order to restructure their lives. This was something he never would have had to do. They had been hit by the stock market “adjustment”.

Another couple that were on our minds for some time had a house worth over $600k that was paid off, and about $900k liquid cash that got hit the other way, through medical catastrophic bills. Her client was dealing with a wife that had a constant series of strokes and heart attacks over a few years. It was a ridiculous amount at a dozen of each, each one having a copay of tens of thousands of dollars. He burned through his cash savings and had to start mortgaging their home every time he needed more money, it got to where he had a payment he couldn’t afford and the decrease in property values meant he lost the home. My wife had to help him find a good home for his birds because he was forced to move into an apartment with his daughter so he couldn’t keep the birds.

 That was why these circumstances were so apparent to Jeanne, she was put in a position where long term clients were getting hit with circumstances that forced them to get rid of their lifetime pets. Out of all the losses retirees were facing, this was the heart breaking killer. Jeanne was coming home nearly every week or two near crying telling me about another heart rending story of financial loss and ruin. Half the time I knew who she was talking about because she had previously talked about them.

I used to blog about this on right wing sites and caught a lot of derision and ridicule, the most common being, “why don’t we see more of this if it’s such a problem?” There were counter posts where others would chime in with a similar story they had heard about.

Fast forward a couple of years to about 2010/11, and we were seeing another part of the aftermath in a first hand way. We had given a house that had a $900k loan on it back to the bank. We had taken enough money out to remodel and sell it to take the equity we had gained over the 12 years we’d had it, we had paid $290k and it was worth well over a million, we had figured to take out about $300k. Values were already getting soft so an ARM was the only option that would allow the money out for remodeling, oops. At two years the payment took a jump from a doable $2800 to an undoable $5800. We let the bank have the house after fighting with them for a year and a half and downsized in a way that cut $8000 a month off of our outgo.

After we had modified our life so as to downsize and eliminate debts, Jeanne’s father died, leaving her a few hundred thousand, we paid off all remaining bills and looked for a foreclosure of short sale to park every dime into, figuring to buy the house with the cash and finance whatever was needed for refurbishing and remodeling it.

It was this process of looking at these foreclosure homes that was the second eye opener. How many people were losing their homes because of medical bills. The statistical facts were supporting that at least 25% of foreclosure homes were the result of medical bills, it may be higher than that because of the lack of input for reasons that existed.

We looked at at least a dozen foreclosures, we were allocating $225k cash for the purchase and found ourselves out to $260k or so on extremely nice homes that might work for us that needed less than the $120k we were allocating for renovation. I was doing something that real estate agents hate, I met with people who were still in their homes that were in a short sale mode. Looking at the $225 to $260 range we were looking at $800k+ mortgaged homes. One that we came close to buying was a four story 4500 square footer that was stunning, that was the one we were willing to go up higher on. After the real estate agent showed it to me, I went back later and met the woman that lived there, she invited me to bring my wife back for a couple of glasses of wine to see the house and meet her husband as well.

He had had a heart attack, and the Kaiser plan he had was of the kind that has high copays. They had been tapped to the tune of $575k in copays and fees. You come up with the money or you don’t get the surgeries and procedures. I am of the opinion that this is a huge fraud scandal, the costs of the procedures are inflated to absurd levels to where the copay is actually what the procedure should be costing, it’s simple accounting slight of hand, otherwise known as fraud. These people ended up with over $800k in loans against their home, and it was selling for around $260k as a short sale.

We find the sheer number of well situated people that have lost their homes and retirement savings to be offensive. These are not the people who used a system that made money excessively easy to get to where people were taking equity out of their homes with loans they wouldn’t be able to pay for when the ARM kicks into a higher payment. Those people got what they ignorantly bought into. We were paying over $1800 a month in Kaiser fees so that we had the best plan with maximum out of pocket possible that doesn’t exceed $4500. $1800 is way beyond most people’s ability to pay, so many people who have healthcare are in plans that a heart attack or cancer could cost amounts of money that would force a refinance to cover copays if they don’t have cash in the bank.

I suspect that the demographics of those who are subject to being hit with copays that wipe out retirement savings and equity is heavier among ignorant people who don’t understand or think this is going to affect them until it does. I can tell you that Kaiser had or has the real death panels. If you have a heart attack or need medication or procedures that are going to cost hundreds of thousands of dollars, you come up with the 20% or whatever the copay is, and the procedure is scheduled after the money has been cleared. No money no surgery.

Now we are seeing an all out assault by the GOP on the elderly as well as those who are working and trying to raise families. The medical industry does not care what a person’t situation is, it demands huge life altering cash to receive the care. It’s the hidden wealth and security robber. The GOP is gutting the things that were put in place to protect people from what happened toward the end of Bush’s terms. What happened was the direct result of deregulation that took the better part of eight years to wipe out somewhere around $20 Trillion dollars of people’s hard earned and saved money. That debacle changed hundreds of thousands if not millions of people’s lives.

Three weeks into Trump’s regime we are seeing an all out assault on people’s financial health…

• The CFPB is endangered, that is the entity that is the only recourse for those who are being abused by banks. The GOP makes no attempt to hide the fact that they will gut or do away with it. The GOP has already stripped a regulation put into place that limits bank fees on overdrafts. Actions like that make no sense, and they should have to undergo legislative scrutiny in order to pass them.
• They are going to gut or completely repeal Dodd-Franck, which was put in place to restrain Wallstreet from the predatory practices that contributed to the 2007/2008 debacle. We’ve seen what this causes once before, and we are destined to see a worse version of that the next time around. The industry knows how toxic credit default swaps work, and they will be going full tilt into making bad loans that are passed from bank to bank until an adjustment occurs, at which time the government that’s run by Wallstreet insiders takes trillions of dollars to bail out these banks who are holding loans they know are bad.
• The GOP makes no bones about the fact that they intend to dramatically lower taxes for the wealthy. This has been tried before, it does not work. Bush stepped into an economy where we had a budget surplus, to pay down the debt it takes a surplus to do it. Republicans couldn’t understand that so they gave away the surplus to the wealthy and went back to increasing the debt. Now they are going to double down on that thing that did not work. In a sane world taxes would be rolled back to where they were when Bush took office, you know, the place where Clinton had created a budget surplus, where the country had put on nearly 25 million jobs. Lower taxes under Bush equated to losing almost 25 million jobs, the same number that Clinton put on after raising taxes. 
• Trump has said idiotic things to accompany his executive action that allows banks to lend money to those who they can’t now due to regulation. I had caught something to the effect that Trump said he had friends (family?) that couldn’t borrow the money they needed for their business, that this was going to stimulate the economy. I’m sorry, but part of bank and wallstreet regulations is that it makes loans much more secure for the industry, and qualifies borrowers in a way that goes a long way toward loans that are never defaulted on. If this isn’t a key part of financial security and strength then I don’t know what is. Trump was a toxic loan risk, he got loans knowing he was going to strategically strip off assets and default or force the banks into bigger loans or debt reductions. People who can’t get loans due to regulations shouldn’t be able to get loans. People who have gotten loans the last few years had tougher requirements, but they are far less likely to lose their homes because they can’t afford an increase due to an ARM.

We are likely to see the even more disastrous things the GOP has on their wish list, and these are the things that put extra nails in the coffin the economy is currently sitting in..

• Privatization of Social Security, this has got to be one of the most idiotic fucking ideas among a score of idiotic ideas the GOP has. The idea that this vast pool of money can be better managed by the Wallstreet that managed to pilfer $20 Trillion dollars from retirement and investment funds is beyond ludicrous. It is 100% assured that Wallstreet would plunder these funds with unregulated abandon, thereby contributing to an inevitable adjustment or more likely a crash. The concept of exposing this money to risk is the definition of what is meant by Fiduciary trust, the industry is 100% aware of the risk exposure, and they are also aware of the nature of stripping assets. Any hedge fund manager making over a billion dollars a year is stealing money from the funds they are controlling, and they know what’s wrong with what they are doing.
• The system being headed up with Wallstreet insiders from Goldman Sucks, would inevitably see that the government needs to bail out the industry when it nosedives. Knowing this the industry will exacerbate their reckless behavior knowing that the endgame will be paid for by the Federal Reserve, headed up of course by an industry insider. Wallstreet and banks will be right back at the practices that created the housing bubble in a fraction of the time it took to create last time.

The last adjustment was a little hiccup compared to what it is likelier to be when it happens again. Right now it is way harder to take the kinds of cash out of a home that led up to 07/08, back then it was stated income, and you could take a loan out that was bigger than the house was worth. Now it’s harder to borrow 100% of value, and the appraisal process tends to be much more conservative. This actually is a good thing.

There are other Executive and GOP actions being taken already that will cost americans their hard earned money. An economic crash will create chaos that results in an level of costs to our country that is incomprehensible.

If the hard right ever catches wind of the way the right has been playing them for fools, it will be the day when GOP elected officials need to hide in another country.

The whole healthcare industry and how it’s geared to cost people such an excessive amount of money compared to the actual cost of healthcare and drugs is totally ridiculous. We have an amount of money going into covering those who have healthcare that is many multiples higher than it is in any other country, including those who have healthcare for all. Yet tens of millions of people do not have healthcare coverage. The money is going into the healthcare industry and the industry is not delivering what we are paying for. The for profit industry has had the chance to do it right, now it’s time for the industry to be run and controlled by the government, the VA is the example of how that works and how many people can be covered by the money that goes into the system, it is a fraction of the rest of the for profit industry.

There is a lot more to this, please feel free to add your insights about things I’ve missed, this is about learning more for me. This is a tip of the iceberg.