[TKDietz]

"And if there is suddenly an influx of cash into mutual funds and the stock market, well it's like printing money.. with no inherent increase in value, the price of stocks will momentarily go up... the big players and market timers will take the windfall, and then the markets will renomalize back into place. "

That's an interesting point. A big infusion of cash into the market inflates stock prices. But if there isn't a corresponding increase in the actual value of these corporations, the market will realize that the stocks are overvalued and correct that. Stock prices drop to reflect their actual or perceived value, and those shares you bought all the sudden aren't worth nearly what you paid for them. One would hope that all the corporations would take all this new money and make it work for them, increasing the value of their companies, but that is easier said than done. That would probably happen for some corporations, but there are no guarantees. Throwing more money at a corporation certainly doesn't always make the corporation become more profitable in the long run.

[linda_22003]

And that's where diversification comes in.... :)

[ziggygrey]

Throwing more money at a corporation certainly doesn't always make the corporation become more profitable in the long run.

Corporations will be very happy to have all that S.S. $$$ flowing into their coffers, because they'll have no obligation to us (unlike the current program). I still remember neighbors who had a retirement plan with K Mart... K Mart went through bankrupcy and re-emerged as a "different" company (even though same buildings, docks, distribution centers and Martha Stewart merchandise) - but my neighbors had nothing. It was legalized theft.

S.S. isn't an investment, it's social insurance. I don't jump on the "I'll make 10X more $$ in the stock market" bandwagon because it won't work out that way if a large fraction of us make that move... we'll be "renormalized" out of all our retirement.