Manulife

[squash500]

Rockslinger...you're a nice guy and I like you, but that first post was incredibly stupid.

Your post should have asked a question like "what is wrong with manulife" or it should have been a question you followed up with in a subsequent post "does the market know something about manulife we don't?". But to say "is it true" is to imply that that somewhere somebody is talking about them going tits up...and if you can't show us where, then it was irresponsible.

Barca I agree with you 100% . Now that I know what a financial guru you are I can't argue with you anymore---lol.

I also think that Rockslinger is a nice guy---no homo!

 

[dcbogey]

My friend's parents who went to retire in a "white gated community" in warm weather South Africa put all their nest egg in a South African insurance company that promised to pay them a million dollars a year for as long as they shall live. Two years later that insurance company went belly up and the money was nowhere to be found. The parents returned to Canada and were living in my friend's one bedroom apartment the last time I looked. I remember thinking to myself at the time that this could never happen in a first world country like Canada. Thank goodness they changed the accounting rules!

Two questions -
1) How much was the nest egg?
2) Are they that gullible?

 

[nottyboi]

Two questions -
1) How much was the nest egg?
2) Are they that gullible?

Yeah I never could understand people who put all their eggs in one basket. For me to get wiped out several banks would have to go belly up and the Canadian govt would also have to go broke....not impossible though.

 

[Rockslinger]

1) How much was the nest egg? 2) Are they that gullible?

Good questions, I don't have the exact details since it is the parents of a friend.
1) The father was an orthopedic surgeon so he earned good money for a long time so I would imagine a decent size nest egg. I think he used a lump sum to buy an annuity from the South African insurance company (somewhat similar to what you would do with your RRSP at age 71 here in Canada).
2) I think they got financial advice from a local South African advisor. The father being a surgeon and the wife being a homemaker were not all that financially astute. Is it true that doctors are the worst investors?

Gratutious comment: Life in a "white gated community" in warm weather South Africa is actually quite pleasant from what I was told. You are actually shielded from the poverty and crime that affect ordinary locals.

 

[Barca]

Barca I agree with you 100% . Now that I know what a financial guru you are I can't argue with you anymore---lol.

I also think that Rockslinger is a nice guy---no homo!

LOL!

Don't take my word as gospel though...I'm just a hack on the floor.

But from a "trader" perspective...if I did that on the phone with another dealer or counterparty, I'd have big problems.

No homo....LMAO!

 

[Rockslinger]

Actually, another question arises as a result of our discussion. What do you plan to do with your RRSP at age 71?
1) Take out all the money.
2) RRIF
3) Buy an annuity. What protection do you have with an annuity if the carrier runs into problems? Is it CDIC guaranteed? Or, are you just an unsecured creditor?

 

[enduser1]

Manulife lobbied the regulators to change soem acounting rules to avoid bankruptcy. If they had been forced to "Mark to Market" they would not have sufficient assets to cover their liabilities and would be bankrupt..

A lot of companies did that in the 1930's. In fact they were allowed by of all people Roosevelt to keep stocks listed at the purchase price on their books, in order to prevent insolvency.

Mark to Market was an idea that originated in the 1920's. Enron was the firm that brought back Mark to Market in a big way as a means of booking "profits" on its own stock in a rising market.

BTW what is worse are derivatives like swaps which are Marked to Model. Marked to Model means that each party decides whatever the value is going to be and that way they can both book a profit. It is total crap and it is what is killing the US banking system. The entire crisis in the US got going because Lehman was forced to recognize losses on it's portforlio.

EU

 

[Rockslinger]

Marked to Model means that each party decides whatever the value is going to be and that way they can both book a profit.

Maybe you know the answer. I thought I heard a few years ago that the IRS hired a bunch of nuclear physicists to develop a proper "Mark to Model" method. If yes, whatever happened to that project?

BTW I learned in Accounting 101 that double counting profits is not only a no no but will also increase your income taxes.

 

[enduser1]

Maybe you know the answer. I thought I heard a few years ago that the IRS hired a bunch of nuclear physicists to develop a proper "Mark to Model" method. If yes, whatever happened to that project?

BTW I learned in Accounting 101 that double counting profits is not only a no no but will also increase your income taxes.

It was as a result of the bailout, I don't know what happenned with that project.

 

[dcbogey]

Manulife lobbied the regulators to change soem acounting rules to avoid bankruptcy. If they had been forced to "Mark to Market" they would not have sufficient assets to cover their liabilities and would be bankrupt..

You may want to check the facts on that statement.

 

[Barca]

Actually, another question arises as a result of our discussion. What do you plan to do with your RRSP at age 71?
1) Take out all the money.
2) RRIF
3) Buy an annuity. What protection do you have with an annuity if the carrier runs into problems? Is it CDIC guaranteed? Or, are you just an unsecured creditor?

Personal opinion? I think life annuities are great, especially since people are living so much longer these days. But there are so many variables.

Annuities are insured by the CDIC version of the insurance industry...I forgot what it's called.

 

[james t kirk]

It still has a market cap of 21 billion dollars, as opposed to GM which is now less than a billion.

I bought TD in 2000 for 30 bucks a share after the great tech meltdown.

Guess what, it's back to 30 bucks after being around 80.

Of course, I didn't sell.

Every single stock I own is massively in the red. It's like the entire world is going bankrupt.

My Sunlife is back to its IPS share price.

I thought we hit bottom in November, now, I'm not so sure. It's entirely conceivable that the TSX could hit 5,000, or even 4,000.

 

[JohnLarue]

Personal opinion? I think life annuities are great, especially since people are living so much longer these days. But there are so many variables.

Annuities are insured by the CDIC version of the insurance industry...I forgot what it's called.

Things may have changed, however I recall one sleaze bag FP tried to sell my grandmother an annuity.
She would have had to live to 102 to get a decent return

 

[Rockslinger]

It's like the entire world is going bankrupt.

Isn't wealth a relative concept? Maybe being a millionaire in 2009 will actually mean something again because millionaires are no longer a dime a dozen like they were in 2007.

 

[Rockslinger]

Things may have changed, however I recall one sleaze bag FP tried to sell my grandmother an annuity.
She would have had to live to 102 to get a decent return

Yep, I do have serious concerns about handing my life savings at age 71 to some institution in return for a promise they will pay me $100 a month for the rest of my life. What happens if one day the cheques stop coming? Do I call 911? (My friend's parents terrible South African experience haunts me to this day.)

 

[Barca]

Things may have changed, however I recall one sleaze bag FP tried to sell my grandmother an annuity.
She would have had to live to 102 to get a decent return

Obviously you'd have to look at an annuity that makes sense. If it's one where you only have to reach 85 or 90 and then anything beyond that is gravy...well...that kind of security is worth it to some who want the security.

But 102? That is indeed a ripoff.

But look at it from a retiree's perspective. In this market, if you can have secure income for the rest of your life...wouldn't you give it a second look? I know if I was that age...I certainly would.

 

[squash500]

Personal opinion? I think life annuities are great, especially since people are living so much longer these days. But there are so many variables.

Annuities are insured by the CDIC version of the insurance industry...I forgot what it's called.

IMHO, aren't life annuities a bad thing if you want to leave some sort of estate for your heirs?

From what I've been reading if you set up an annuity when you're for example a 60 years old man and have two grown kids etc.

If this 60 year old man dies prematurely at age 70 then the kids will get nothing from the estate depending on the size of the annuity? The insurance company will grab the rest of the money on this 70 year old man's death.

IMHO, annuities are probably best suited for either single or widowed men and women with no dependents or alternatively where the grown kids are financially self-sufficient and don't need the parents money once the parent or parents pass away?

As usual just my opinion!

 

[Barca]

Ah...I found it. The organization that protects insurance products in case of a company going under.

Assuris.

http://www.assuris.ca/

 

[Barca]

IMHO, aren't life annuities a bad thing if you want to leave some sort of estate for your heirs?

From what I've been reading if you set up an annuity when you're for example a 60 years old man and have two grown kids etc.

If this 60 year old man dies prematurely at age 70 then the kids will get nothing from the estate depending on the size of the annuity? The insurance company will grab the rest of the money on this 70 year old man's death.

IMHO, annuities are probably best suited for either single or widowed men and women with no dependents or alternatively where the grown kids are financially self-sufficient and don't need the parents money once the parent or parents pass away?

As usual just my opinion!

Exactly...the variables are what determine if it's a right product for you.

For example...you don't have to convert ALL your savings into an annuity. Take part of the money and secure some income for life.

For someone like me with no kids...and no plans on having any, at 71 if I am relatively healthy, I'll probably opt for at least part of my money going into an annuity. Peace of mind is worth it sometimes.

 

[brocko]

Manu has had writedowns in equities and also took close to a billion hit when Morgan Stanley and Washington Mutual went down. Manu is a financial institution operating globally so looking around the world especially in the U.S. no wonder they are down. Their life insurance business is booming but its the other stuff thats suffering. A lot of insurance company stocks are owned by large pension funds who are in and out day to day based on whats happening. Look to Manu to buy a big piece of AIG in Asia when the auction is completed. Lots of places to read up on Manu but I like the Globe which keeps things current.