Economic Depression + Insurance Sales 2010

tex · 10-31-2009, 12:55 PM

Greetings,

I have been holding back on this issue because as former military I hear things and understand fully the condition of the dollar and our so called jobless recovery, I know we are propagandized by the media to believe all is peachy - and far be it for me to rattle others paradigm.

Jobless recovery - As if that weren't the most profound oxymoron ever spoken.

Honestly I do have concerns and won't air them all here, however what I am interested in is how others are feeling and thinking about the next 12 months.

1 ) In the health arena, is the government taking a majority share of this market going to hurt allot of independent agents ?

2 ) With over 4 million jobs lost since Jan 09, will people continue to spend their money on Insurance or will they pay their gas bill or buy groceries.

3 ) If hyper inflation arises next year as it has in many other countries, such as Iceland where McDonnalds pulled out of because a Med. Fries cost over 20.00 dollars; or Africa where it takes a wheel barrel of cash to buy food for the day.

Also in many countries, people are having to be payed many times a day because the local money is devaluing so quickly.

I believe one of my beloved countries biggest problems is in the mind set that if it's not happening to me, or not in my back yard, then it's not happening or it's not important - this is a trap - we've all already bought into it for far too long.

So bringing this full circle, I want to know how or where you'll feel 2010 will take us.

I'm almost sure none of you know how in NY the medical staff in most major hospitals were told the H1N1 shot was mandatory subject to being fired. Hundreds walked off the job despite the 20+ years on the job including the pensions and all.

Since this ( about 3 weeks ago ) the nurses were awarded an injunction by a judge and I don't know if they got their jobs back or what. But clearly we are living in unusual times and I'd like to know how you all feel this may or may not effect your trade.

Subnote, I don't expect almost anyone to understand everything as I do, and I am not going to try to educate anyone on the little cogs which broke our wheel, I just want to know from your prospective, and what you feel the challenges are that face us in 2010.

Warm Regards

Full Throttle · 10-31-2009, 01:07 PM

I don't think worrying about this will put you in any better of a situation. If it all goes to hell and we have hyper inflation, what are your alternatives? Just about every business and position will be negatively impacted, can't really hide from it if you plan to live here. About the only thing you can do is hedge your savings the best you can, then see what happens. The rest is simply wasted emotional energy in my opinion.

From a selfish stand point, if we are going to see hyper inflation, I would like to see it while I am young so we can move forward from it. It may be the only thing that actually makes our government become more responsible with financially managing their obligations, I don't see the change happening without being forced to do so.

tex · 10-31-2009, 01:11 PM

Full Throttle good input.

However, being informed is a part of hedging your saving. And I am concerned our biggest personal problem is a lack of dialog. People share knowledge and dialog in order to minimize their disposition.

DHK · 10-31-2009, 02:16 PM

I'll address your different points here:

1. People who don't know how to adapt to the only constant in our world (change & government) will become obsolete. Health agents can be (should be) life agents as well and can learn additional skills to make other sales.

Shame on those agents who aren't seeing the "writing on the wall" and making preparations.

2. If you're selling large policies to people who may eventually be in a position to choose between their insurance & the basics of life, I would contend that that is an unsuitable sale and they will probably drop the policy. YOUR JOB would be to say "Hey, let's convert this back to term (or issue a new term policy) and reduce the level of the larger insurance policy premiums."

If you don't, someone else will.

If it were me, people would need to have some savings already established (to show they already have the habit) before selling a larger wl policy. Maybe a small one would be fine - to help them see the benefits of it (a $10,000 or $25,000 face policy) and a lot of term to go with it.

3. Worrying about economic conditions that are outside of our control expends too much energy and makes us paralyzed.

People in the USA need to understand 3 things:
1. They need to save money for the future.
2. They need to have a way to protect the ones they love from their untimely death.
3. They need to have a way to pay for things when they are too sick to work.

Life insurance & disability insurance do a great job of that. Annuities also help. LTC also helps protect assets from eroding in the need of custodial care.

Help people GAIN CONTROL of their lives - especially when everything else around them feels like it's going all to hell.

If you don't feel in control of your own financial life (and your personal economic situation), your prospects will sense that and they won't follow through on your own recommendations.

The challenges that face us are:
1. The media claiming that everything is out of our control
2. The mass public believing in the drive-by media
3. The massive spending out of Washington to improve our stock markets at the expense of the tax-payer. (Hey, if the stock market doubles, but so does our tax rates, what is the end result?)
4. The Mass Public believing that "there aren't any jobs out there... so I blame everybody and everything because the world owes me a living!"
5. Employers who may not want to offer additional employee benefits because it's an "employer's market" on labor - why spend the additional time & money?
6. Smaller businesses continue to close due to the large scale operations overseas with cheap labor and larger buying power. So when business owners think about their businesses, they don't feel empowered and feel that it would be worthwhile to begin a long-term savings & continuation plan.

So, basically... nothing changes much.

tex · 10-31-2009, 02:27 PM

Well with the Arabs no longer selling oil for dollars, and the Chinese no longer financing our nations new ( looted ) debt by not buying t-bills - there is a real concern for our currency, from there the ripples are broad.

By the way, i don't watch the news because I know it's all paid for.

True Professional Journalism is dead in America.

Full Throttle · 10-31-2009, 03:13 PM

well with the Arabs no longer selling oil for dollars, and the Chinese no longer financing our nations new ( looted ) debt by not buying t-bills - there is a real concern for our currency, from there the ripples are broad.

I agree this is a concern, but now what do you do? Worrying about it does nothing, only taking action within your control. If you feel this is an almost certainty, take the steps you deem appropriate. As far as earned income goes, you will be altered if you sell insurance or work for the government, so why worry about it from that angle? The world will go on, there will always be opportunities for those willing to work for it, you just might have to scrap a little harder in the short run. I have enough to handle today without worrying about something outside my control.

Franz Kafka · 10-31-2009, 03:34 PM

Ah it's not so bad. I personally don't know anyone who's starving. My late father who came from an old country didn't know anyone who wasn't starving.

Inflation is NOT a problem. It's a SOLUTION to a problem -which is lack of production efficiency. Inflation is the only surefire way to guarantee that people work harder and more for the same amount of money. We've all been lazy way too long.

Winter · 10-31-2009, 03:38 PM

Originally Posted by tex

2 ) With over 4 million jobs lost since Jan 09, will people continue to spend their money on Insurance or will they pay their gas bill or buy groceries.

I see more clients going in both directions these days. The client who had some stupid high-priced UL or VUL that is going to blow up on them wants out even moreso and to revert back to some basic term.

On the other hand, there is a whole pantload of people who thought they would not need life insurance because their retirment and investment funds would take care of things if something happened. Now they are in their fifties and have refinanced their house five times over and have concluded that the only way that they are leaving $250,000 to anyone is if they get an insurance policy.

tex · 10-31-2009, 04:36 PM

Well there is no wrong answer, I appreciate these prospective.

Also, anyone interested in the H1N1 shots need to do their due diligence, some key words ( ingredients ) to research are squalene, thimerosal ( mercury ) and formaldehyde - as well as live cancer virus as substrate.

* squalene is naturally found in nature ( foods ) , and even used in facial make-up by some brands, the difference is when you inject it, your body white blood cells and otherwise your body's defense system
Kicks in and attacks it as it should - the problem is since it's in your body naturally, your body then attacks
It's self in an effort to get all the squalene to be gone - leading to all kinds of degenerative disablilties, possibly
Worst of you already have diabetes or other chronic conditions.

* Mercury floats around the body and lands in the brain, long story short, and given varying levels of
Immunity and or pre-disposition, it is to some degree or another the exact same effect as a lobotomy,
Only executed via liquid injection of mercury ( attacking the tissue between the left and right lobe).

Many people have already died across EU as result of the shots.

Our kids are being squirted up the nose with the stuff w/o parents permission already - protect yoiur family and friends.

VolAgent · 10-31-2009, 07:16 PM

Originally Posted by Franz Kafka

Inflation is NOT a problem. It's a SOLUTION to a problem -which is lack of production efficiency. Inflation is the only surefire way to guarantee that people work harder and more for the same amount of money. We've all been lazy way too long.

Please explain this to me. Productivity is always increasing, in fact greater worker productivity is what has lead to jobless recoveries in the past, and stagnant wages when compared to inflation. Also, why in the world should someone have to work harder today to make the same money he made yesterday?

Franz Kafka · 11-01-2009, 01:23 AM

Originally Posted by VolAgent

Please explain this to me. Productivity is always increasing, in fact greater worker productivity is what has lead to jobless recoveries in the past, and stagnant wages when compared to inflation. Also, why in the world should someone have to work harder today to make the same money he made yesterday?

Stagnant wages + Inflation = Working harder or longer for the same amount of buying power.

Productivity charts can be misleading. During an economic boom production runs on maximum utilization capacity - i.e. hiring more unqualified workers, paying more for quality work, over-paying for overtime, more employee benefits, less quality control, less customer service, less maintenance etc etc all of which although increases production but at higher cost. Higher cost of production kicks in inflation which begins the downward move on the economic cycle (recession). Companies start minimizing utilization capacity - layoffs, not hiring less qualified workers, cutting benefits, more quality control, more service and maintenance - which leads to higher production efficiency.

Inflation is a solution because it leads to recession. Recession is good because it forces the economy to return to its higher production efficiency. The worst that can happen to an economy is a rapid expansion because a rapid expansion creates too many unqualified workers earning too much buying power. A serious recession should have hit US about 10 years ago but instead it was artificially sustained by more and more debt. IMO the best thing that can help our current economy is a prolonged inflation and recession (but not too much). Running an economy is like controlling a wild horse. You want it to run but not too fast. You rein in too much, the horse will stop. It's an extremely fine balancing act and our jockeys have been DUI.

tex · 11-01-2009, 12:02 PM

My mom has 12 Arabian horses - I don't care much for them myself. Somehow I think Franz and my mom would get along better than I do with her. You both don't see how a depression / recession is never without great loss of life and liberty. But we all will be impacted, the only question is, how insulated are you.

Those of you who think because you belong to any "global fraternity," that you'll be all right, or those who are rich think you'll be all right, I'd suggest you read up on the great depression.

You all still can not buy a pack of gum without Aspertame. Your meats are still sprayed with bacteria and in some cases radiated if any food comes through customs. Your vaccines are still tainted. Your water is loaded with fluoride and in some metro area even prozac at levels far higher than a few people throwing out some meds. The chemtrails still are loaded with borium and aluminum and other metals affecting your health.

Our middle class is being wiped out from so many directions it's hard to see the patterns, but with the new burocracy of Obama - you will have home and business inspectors logging your fines into the system and be charged with new tickets or infractions for each day you live in your home without making the improvements.

Hell - you masons are not off the hook because the enforcers won't care if you flash the sign of distress.

Better yet look at the famine in Egypt or India or Iceland, etc. We're not talking third world cess pits, but they are quickly being turned into one - hell look at Africa, all these countries have a Federal Reserve and they all have been looted for generally the same money, 24+ trillion in our case.

People - just don't take the shots - that's all I really care about - just don't take the H1N1 shots.

In closing, comparing what's ahead of us to anything that's already behind us is in my view extremely short sighted. You can not compare anything to a "deep great depression" because we've never seen one in America.

And, in your lives - you have never known anything but US dollars in America, when that changes all you who think your " to big to fail " ( lol ) will poop yourself if you buy the media spin until the last minute.

* Already, without this manufactured on steroids H1N1 30-33k will die from the seasonal flu ( due to a lack of vitamin D as result of limited SUN exposure ), now you throw in this SUPER VIRUS they want us to believe came from Mexico when in the history of America no Flu has ever come from anywhere but the EAST, and it's not hard to see how 10x or 100x or even 1000x the number of people could die this season ending in March.

* I predict the worst of it to come in Jan and Feb, and not Nov or Dec. - those will be the regular flu deaths.

* Don't ever say I never gave you anything... Protect your family - don't believe me - dig in and find out...

VolAgent · 11-01-2009, 12:31 PM

Again Franz, I think you're missing it. Efficiency and productivity are increasing. If anything, that has probably kept wages stagnant. If 2 workers can now do what it use to take 3, then you need one less worker. Suddenly that creates downward wage pressure. Perhaps someone can reference a study, but I'd be willing to bet that job creation has not kept pace with increased productivity over the last thirty years. There has to be a reason that when compared to the 70s, wages have stayed flat or decreased when compared to profits after accounting for inflation.

Franz Kafka · 11-01-2009, 01:59 PM

Originally Posted by VolAgent

Again Franz, I think you're missing it. Efficiency and productivity are increasing. If anything, that has probably kept wages stagnant. If 2 workers can now do what it use to take 3, then you need one less worker. Suddenly that creates downward wage pressure. Perhaps someone can reference a study, but I'd be willing to bet that job creation has not kept pace with increased productivity over the last thirty years. There has to be a reason that when compared to the 70s, wages have stayed flat or decreased when compared to profits after accounting for inflation.

"Technology and automation will lead us to utopia". That's what all the analysts were saying to tout nasdaq 10,000 when it was at 5,000 based on the productivity chart. That's why I said it was misleading. It's a simplistic/linear way of looking at the economy. If indeed the cost of production was decreasing each year (like that chart suggests) we would have experienced steady deflation instead of inflation. Reality speaks against that. Yes, technological progress has helped us to lower the cost of production but the actual cost/wealth/buying power that were paid out/shared among everyone (not just the shareholders) in the last 20 years far exceeded what it should have been. Much of this was possible because inflation was kept artificially low when in fact it should have been higher.

A similar situation occured during the period from 1945-1965 when a gas station attendant could buy a home and support his family. Look at the inflation rates during that time - the same artificially low numbers. Years that followed from 65-85 paid for that partly with excessive inflation to make up for the previously unwarranted wealth and exuberance. Since then we have had another unwarranted wealth shared based on rapid expansion from 85-05 made possible again by artificially low inflation numbers. A generation (in this case 20 years) gets paid more than what it's worth and the next generation picks up the tab. IMO we have just begun a generation that will pick up the tab left by 85-05.

GAHEALTH · 11-01-2009, 08:22 PM

Originally Posted by Winter

I see more clients going in both directions these days. The client who had some stupid high-priced UL or VUL that is going to blow up on them wants out even moreso and to revert back to some basic term.

On the other hand, there is a whole pantload of people who thought they would not need life insurance because their retirment and investment funds would take care of things if something happened. Now they are in their fifties and have refinanced their house five times over and have concluded that the only way that they are leaving $250,000 to anyone is if they get an insurance policy.

So I guess what you are saying is that the dynamics of the business are changing and that there is going to be ample opportunity to convert peoples' policies or gain new clients because of heighten awareness.

I think people are more apt these days to invest in themselves - but will always be on some sort of budget. If you can help them find the money without them having to sacrifice much - like stop spending on Starbucks and start with Dunkin Donuts - take that $3/day savings and put it here - then you should be able to gain additional business.

ATM · 11-02-2009, 04:02 PM

Originally Posted by Franz Kafka

Ah it's not so bad. I personally don't know anyone who's starving. My late father who came from an old country didn't know anyone who wasn't starving.

Inflation is NOT a problem. It's a SOLUTION to a problem -which is lack of production efficiency. Inflation is the only surefire way to guarantee that people work harder and more for the same amount of money. We've all been lazy way too long.

I beg to differ. Inflation is a problem in that it robs citizens of their purchasing power. It's the great stealer of wealth.

Now perhaps inflation can be seen as a problem solver in one sense. It allows our government to steal our wealth while simultaneously ripping off all the poor people who loaned us money over the years! The only problem with that is that all these poor lenders (the people who bought our bonds) will see that their only course of action is to spend their dollars in the US as fast as possible, thereby repatriating trillions of US dollars and accelerating inflation even faster.

In the last great depression there were plenty of good but no one had the money to buy anything. In the next great depression everyone will have plenty of money but no one will want to sell you any goods in exchange.

When money is worthless, goods still retain their value.

We have gone through two huge asset bubbles over the past decade and a half because of inflation. The dot.com bubble burst and all that money then flowed into real estate which is still bursting and the $ is now inflating a bond bubble that will surely burst as well.

The bond bubble is bigger and will burst far quicker than the others and will cause what is generally, but wrongly considered inflation - rising prices. That is just a symptom of inflation and we will surely see that symptom in the future some time as all those trillions of dollars of treasury debt, bailouts, etc come flooding back when everyone decides that to hold dollars is riskier than holding something else.

We are starting to see those something elses already. Gold is rising against all currencies. Oil and other commodities as well. people have realized right now that they can borrow dollars at negative real rates - they get paid to borrow - then they invest in income producing assets and get paid twice!

Inflation doesn't spur productivity unless you view poverty as a spur to produce! If that's the case and poverty is a driver why don't we just raise real tax rates to 90% and impoverish everyone to work harder??

Too many people think that we really haven't seen inflation inthis country but we are living it right now. Want proof? In 1964 a gallon of regular gas cost about a quarter. Today? Well, it still costs a 1964 quarter! (90% silver) A dime in 1964 bought a loaf of bread and that same 1964 dime still buys a loaf but that new, fiat money, the inflated stuff buys almost nothing.

The dollar is dead we just havenm't gotten the death certificate yet.