Should you be concerned with your investment portfolio or pension fund?

here is a vent email I wrote to family and frends about one month ago. (never sent it) so here it is to kick things off.

As some of you may or may not know, I use to be a financial adviser. Back in that time of my life I believed my primary mission was to match each person with the proper portfolio through risk mitigation and risk management. there was no higher goal, anticipated investment return was relegated as a dependent to the primary focus. Because the most important thing is to know you are not taking more risks than, you are willing, or taking on more than you need. This is met by matching each individual with the proper balance of cash, bonds and stocks. I took great care and pride in this responsibility.

Now imagine if you, the investor or adviser, made those decisions thoughtfully and wisely fully knowing the risk, or lack there of that you were taking. You felt good with that portfolio, you could sleep at night with the risk you were taking. You may be saying now in the light of the current financial crisis while looking at the portfolio, "maybe I shouldn't have taken so much risk, well it could be worse, at least I have some safe investments such as bonds or bond mutual funds those are holding value ok." Or better yet "at least I have my pension fund, those guys put it in the safest investments out there, its safe." is it really?

Consider the following, As a refresher, one reason bonds are a "safer" investment is because in the event of default the bondholder is first in line to recoup their investment. However In the Chrysler case the current white house administration has been trying to circumvent those laws and rights, forcing bondholders to a secondary class, and trying to reduce their claims to about 36 cents on the Dollar to avoid bankruptcy. thereby increasing the risk in the investment on a a group that did not want those risks and force those investors into taking less money than they may otherwise be entitled to.

If they, the bond holder, wanted the extra risk they would have bought stock. If you can not trust the investment you make and the "safety" you feel in a certain class of investment because the government can rewrite the rules on a case by case basis such as the attempt in the Chrysler bankruptcy it will ultimately create anarchy in the financial market. weather that effect is intentional or not.

In addition, lets look at some of the people that could be relegated to the back of the line even though their investment gives them the RIGHT to the front of the line to recoup their investment. Its not just hedge funds, and multimillionaires. In Chrysler's case who are these potentially evil people that caused Chrysler to go into bankruptcy and keep Obama out of the deal he wanted.
Here is a list of some of these bond holders, not necessarily the ones that would agree to obamas deal:
Montana Board Fund (aka: state of montana) which think god is "required by law to operate under the "prudent expert principle","
Childrens Hospital Philidelphia
Los Angeles Fire and Police
Indania State Police PENSION fund
Municipal Employee Retirement System Michigan
Employee Retirement System of Baltimore County
Seattle City Employee Retirement
Rotary International Foundation

information from http://zerohedge.blogspot.com/2009/05/chrysler-ultimatum-and-full-list-of.html

I'm sorry but this doesn't sound like a bunch of money grubbing wealthy wall street people keeping Obama from doing what he wants with Chrysler. But rather hard working americans trying to invest for the future. Sure I left out the Bill Gates and halliburton's and Yale University's. But you get my point, real people, Republicans and Democrats with their life savings and pensions who thought they had a relatively safe investment have been asked to be pushed to the back of the line as though they were second class citizens when that is not what they signed up for. But more to the point this is still a free country and no citizen should be threatened by White house staff to do something irresponsibile and aginst prudent investment practices not to mention illegal for all involved.

Please listen to the attached MP3 further understand the gravity of the situation and the potently far reaching affects. If you think "well its not my problem I don't hold Chrysler, or GM." are you sure? can you say that. Do you know exactly what your bond fund is invested in? and if for a fact you know you don't hold these how do you know yours is safe from these types of actions?

Most concerning and thought provoking to me is the following quote from the clip, "The President is trying to abrogate contractual rights; if he will attack that contractual right, what right will he not attack?"

There are a lot of things these days that are not being covered by main stream media with regards to the current economic crisis and the strong arming and blatant disregard for the law and its citizens. Therefore it is up to us to ensure that everyone we know is aware of the truth. I am sending this to both republican and democrats that I know. Because I believe that no matter who you voted for you realize that not all things are right.