How long will starving governments keep their itchy fingers off your private pension funds? Only as long as they can't get away with it. And governments are literally getting away with murder these days. Why not your pension money, too?
It happened in Argentina, Hungary, Ireland, and France. Here's how it will happen in America. After another financial crisis, Congress will "protect" you by requiring managed retirement plans to include X percent of Treasury bonds at a return well below inflation.
Or, perhaps, government(s) will get innovative with pensions like California. Governor Jerry Brown just signed Bill 1234 which creates America's first state-sponsored and state-managed retirement program for private sector workers. Every private employer with 5 or more workers without an existing employer-sponsored pension plan will automatically deposit 3% of the workers' income into a government-run retirement plan. Who is eligible? Every employee who does not go through the process and paperwork to opt-out; and they have to opt-out every 2 years. Otherwise, they are opted-in, over and over again.
The scheme is expected to put $6.6 billion under state management in the first year. The presumed manager is California Public Employees' Retirement System (CalPERS) - the biggest U.S. pension fund with 1.6 million public sector employees.
CalPERS is in fiscal death throes. According to state Senator Mimi Walters, "California has... a terrible track record when it comes to maintaining its public pension systems; the systems are currently a combined $240-$500 billion in debt." And, so, one type of investment explicitly permitted by the bill is "United States government and government sponsored entity debt obligations." The government can use private pension funds to purchase public debt at a return of 3%. Worse, CalPERS must pay public employees first from dwindling funds.
That's adding insult to injury; when your pension funds are looted, they will pay for the retirement ease of bureaucrats and civil servants. No wonder Walters calls the bill "a cynical effort to prop up the floundering public employee pension debt with new funds from private investors, sent in by employers who are forced to participate under penalty of law."
Bill 1234 will not prop up the public employee pension for long because CalPERS is a Ponzi scheme. Private Ponzi schemes have a relatively short lifespan after which the perpetrators are fined or jailed. Public Ponzi schemes live longer because laws can force more and more new people into "investing". But after the public Ponzis go bust, the bureaucrats will collect the pensions that are your money, and go home.
The most ominous aspect of this money grab? California is a trend setter not merely in culture but also in politics.
Treat your pension fund as you do your wallet. Do not leave it lying around. Do not flash it in front of the power-drunk thugs that pass for politicians. Do not hand it over to strangers called investment managers for "safe keeping." Those strangers will obey the laws passed by thugs; those strangers will betray you without a second thought. Hang on to your wallet; manage your own pension funds. If you have an IRA, then turn it into a self-directed IRA.
If you have significant assets - enough to attract the attention of desperate elected bandits - then move your assets out of their reach by getting those assets out of the country.
Setting up protected offshore bank accounts is one way to do so. And it doesn't have to be that hard or complicated, especially when you get the right help.
You should keep some precious metals within easy reach, just in case of a currency collapse. But if you have large amounts of gold within the geopolitical borders of the United States - too much to keep beneath the government's radar - then you should be worried. And you should be looking for a way to get your gold out of Dodge. At some point in the near future, if things get bad enough, you may want to consider getting yourself out of Dodge as well.