NEWS/BLOG

Why Outsource Medicare

You can’t take it with you, that is, you can’t take Medicare with you when you retire outside the U.S.  It stops at the border. Meanwhile, economists warn that the retirement of baby boomers threatens to be a train wreck if not a tsunami.

Professor David C. Warner at the LBJ School of Public Affairs, University of Texas, Austin, has written widely about extending Medicare to retirees in Mexico. This would be of considerable benefit to U.S. citizens who retire there, and in addition – and here’s the big selling point – it would result in considerable savings to the U.S. Government. Dr. Warner has cited cost savings to the Medicare trust as a major benefit. Some say the Medicare trust will be bankrupt by 2040.

The average Medicare beneficiary in the U.S. costs the Medicare fund about $7,500 per year. If that same person lived in Mexico, the same health care services would cost about $4,000 per year.  Dr. Warner has written books such as Getting What You Paid For:  Extending Benefits to Eligible Beneficiaries in Mexico (U.S.-Mexican Policy Reports) and others.

Overall, medical costs in the U.S. are higher than in most if not all other countries. Not only do our healthcare professionals earn more, the administrative costs of insurance companies, PPOs, HMOs, etc. add up. One reason healthcare costs in Mexico are far less is that administrative costs there are lower.

Outsourcing healthcare of some retirees to Mexico, some authorities say, is not so different from outsourcing manufacturing, tech support and call centers to foreign countries. It would eliminate a few U.S. jobs, though not many since there would still be paperwork in keeping track of payments to facilities there. Such a plan would be good for Mexico, too, resulting in an increased flow of money across the border, and in time, more and better medical facilities there.

Scots Warn: Big Crash Coming!

The Royal Bank of Scotland is forecasting a major crash in global stock and credit markets within the next three months! The cause, they say, is inflation. A report by the research department of the bank goes so far as to warn that Wall Street’s S&P 500 index may lose 300 points or more by September.

The report also calls for a brief rally early in July.

We all know, of course, that none of the experts can predict a crash or a rally with absolute certainty. But the S&P, the Dow and the Nasdaq have been falling in fits and starts for the last eight months.

You might want to check out our previous posts, “Seeing Bubbles Before They Burst” and “Time to Let the Dog In.” Or
look into this book by David Wiedemer, America’s Bubble Economy: Profit When It Pops or Peter D. Schiff’s Crash Proof: How to Profit From the Coming Economic Collapse (Lynn Sonberg Books)

Do your own due diligence and be very careful when making investment decisions.

Ireland Says “No” to Lisbon Treaty

Ireland has rejected the Lisbon Treaty, which would have consolidated the European Union’s power and streamlined its cumbersome bureaucracy. The treaty needed to be ratified by all 27 EU members.

The Lisbon Treaty was the result of painstaking negotiations. Among other things, it offered a way of adjusting to the 12 new members added since 2004. It allowed for a full-time EU president and provided for a new foreign policy chief. Also, it called for a change in voting procedures on the European Council so that fewer decisions would require unanimous votes.

Ireland is the only country to put the Lisbon Treaty to a referendum, as required by law. However, it’s no secret that people in various EU countries have no real sense of a European identity and feel remote from decisions being made in Brussels.

One instant effect of the Irish decision is that the euro fell to $1.5301 against the dollar.

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Europe Cuts Back on Solar

You may have found solar stocks volatile lately, but they could become more so, as Spain and Germany make policy decisions regarding the use of solar energy.

Germany is slashing the subsidies that built its solar industry up to $8.8 billion in sales. Homes and businesses there have earned a government-guaranteed price of up to 47 euro cents ($0.74) for each kilowatt-hour of solar power they produce.

If the demand for solar energy in Spain should decrease, the high-flying solar stocks with exposure in Spain could be hit hard. These include CSIQ, STP, SOLF and YGE. On the other hand ELSR and ENER have low exposure in Spain.