Well, I don't think you can just "bypass" doing a Final Rule when you have an Interim Rule posted for comment. They can't just skip doing that in hopes of combining both of these things into one Final Rule.......the process doesn't work that way. I think they messed up, and this is going to backfire on them in the end. If they issue an Interim Rule eventually with the proposal for actual IFT restrictions, we need to comment (in force) that they violated the process, by not responding to comments on the first Interim Rule, and not posting a Final Rule on that one. If this ever gets challenged legally (and it will), this is all going to work in our favor in the long run.
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What YOU can do to fight back - IFT limit
- Thread starter James48843
- Start date
Well, I don't think you can just "bypass" doing a Final Rule when you have an Interim Rule posted for comment. They can't just skip doing that in hopes of combining both of these things into one Final Rule.......the process doesn't work that way. I think they messed up, and this is going to backfire on them in the end. If they issue an Interim Rule eventually with the proposal for actual IFT restrictions, we need to comment (in force) that they violated the process, by not responding to comments on the first Interim Rule, and not posting a Final Rule on that one. If this ever gets challenged legally (and it will), this is all going to work in our favor in the long run.
I don't really see from this that that the rule has actually been implemented. The Dec. 27th posting date is still at the bottom of the document.
If it has been, then FRTIB really screwed up, because they're supposed to
publish a Final Rule in the Fed. Register before implementing anything that
is proposed in an Interim Rule. In that Final Rule posting, they are
supposed to address comments received on the proposed Interim Rule. None
of that has happened, as far as I know. If they actually are trying to
implement this change without following that process, it will work in our
favor in the long-run - because any changes made to IFT restrictions that
are based upon a flawed process (which this clearly is) will have to be
overturned in the end, when it is challenged. Anidoc and Paladin, what do
you guys think about this? Am I wrong?
GreenMachine
New member
Got a response from Senator Benjamin Cardin of Maryland from the fax I sent. First they called me then followed up with a letter. In my fax I stated that there needs to be some oversight with regards to how TSP is implementing the changes and how they tried to do it over the holidays.
They said my concerns have been referred to the Thrift Investment Board and would be in touch as soon as they have pertinent information to report.
They said my concerns have been referred to the Thrift Investment Board and would be in touch as soon as they have pertinent information to report.
JonesH2O
New member
With this number of retired Feds in TSP, NARFE (National Active and Retired Federal Employees Association) should also be involved in the fight. http://www.narfe.org/
JonesH2O
New member
I've been meaning to check-up on whether the January 7th change was actually made. If you go to the following link on the Electronic Code of Federal Regulations for Title 5, Part 1601, Sec. 1601.32 (b), you will see that the change was officially made. Looks like more letter writing to Congress is what's needed to call for an investigation (as stated by anidoc) and ask for the the interim rule to be withdrawn.
http://ecfr.gpoaccess.gov/cgi/t/tex...div8&view=text&node=5:3.0.4.5.2.4.48.2&idno=5
http://ecfr.gpoaccess.gov/cgi/t/tex...div8&view=text&node=5:3.0.4.5.2.4.48.2&idno=5
James48843
Well-known member
Another interesting tidbit for thought---
TSP just put up on their website the results of the 2006 survey of participants.
First of all, nearly 10% of surveys mailed out were returned. Sounds like your Thrift Board can't find almost 10% of it's account holders. You should be shocked at that one.
Secondly, go take a look at the survey, at the bottom of page 60 and top of page 61. They talk about adding other funds, and what if they had to restrict interfund transfers in order to save enough money to add other fund choices. Hmmm.......
Here is the link:
Go to the FTRIB's electonic reading room, and look for this:
but you might not be able to get it directly.
Interesting reading.
They also claim a 97% accuracy on this survey. My gut tells me they are WAY off on this one.
There is some good stuff in that survey- fodder for the next issue of the TSPSHAREHOLDER.ORG newsletter. Coming soon. (Like maybe another day or two- I'm working on it. )
TSP just put up on their website the results of the 2006 survey of participants.
First of all, nearly 10% of surveys mailed out were returned. Sounds like your Thrift Board can't find almost 10% of it's account holders. You should be shocked at that one.
Secondly, go take a look at the survey, at the bottom of page 60 and top of page 61. They talk about adding other funds, and what if they had to restrict interfund transfers in order to save enough money to add other fund choices. Hmmm.......
Here is the link:
Go to the FTRIB's electonic reading room, and look for this:
Frequently Requested Records
The hot link is: http://www.frtib.gov/FOIA/2006-TSP-Survey-Results.pdfbut you might not be able to get it directly.
Interesting reading.
They also claim a 97% accuracy on this survey. My gut tells me they are WAY off on this one.
There is some good stuff in that survey- fodder for the next issue of the TSPSHAREHOLDER.ORG newsletter. Coming soon. (Like maybe another day or two- I'm working on it. )
Thank you for contacting me regarding the recent changes to the Thrift Savings Plan (TSP). I appreciate you taking the time to share your concerns with me.
I understand the concerns you have with the http://www.tsp.gov/features/chapter01.html#sub3Federal Retirement Thrift Investment Board when theychanged trading rules to allow only two interfund transfers per month instead of unlimited transfers. When saving for retirement, I believe that you are far better capable than the government to make important decisions that impact your financial security.
I typically favor allowing investors to have greater freedom and flexibility in this process, so that they can save and prepare for the future. I assure you that I will continue to monitor changes to the TSP and fight for the principles of financial freedom. I will keep the views you have expressed to me in mind if any legislation comes before the House.
I hope you will find this information helpful. Please do not hesitate to contact us with any other concerns or questions you may have. You can reach us by phone at (202) 225-2676, or by e-mail through our website at http://jordan.house.gov
Thank you for contacting me regarding the recent changes to the Thrift Savings Plan (TSP). I appreciate you taking the time to share your concerns with me.
I understand the concerns you have with the http://www.tsp.gov/features/chapter01.html#sub3Federal Retirement Thrift Investment Board when theychanged trading rules to allow only two interfund transfers per month instead of unlimited transfers. When saving for retirement, I believe that you are far better capable than the government to make important decisions that impact your financial security.
I typically favor allowing investors to have greater freedom and flexibility in this process, so that they can save and prepare for the future. I assure you that I will continue to monitor changes to the TSP and fight for the principles of financial freedom. I will keep the views you have expressed to me in mind if any legislation comes before the House.
I hope you will find this information helpful. Please do not hesitate to contact us with any other concerns or questions you may have. You can reach us by phone at (202) 225-2676, or by e-mail through our website at http://jordan.house.gov
I understand the concerns you have with the http://www.tsp.gov/features/chapter01.html#sub3Federal Retirement Thrift Investment Board when theychanged trading rules to allow only two interfund transfers per month instead of unlimited transfers. When saving for retirement, I believe that you are far better capable than the government to make important decisions that impact your financial security.
I typically favor allowing investors to have greater freedom and flexibility in this process, so that they can save and prepare for the future. I assure you that I will continue to monitor changes to the TSP and fight for the principles of financial freedom. I will keep the views you have expressed to me in mind if any legislation comes before the House.
I hope you will find this information helpful. Please do not hesitate to contact us with any other concerns or questions you may have. You can reach us by phone at (202) 225-2676, or by e-mail through our website at http://jordan.house.gov
Thank you for contacting me regarding the recent changes to the Thrift Savings Plan (TSP). I appreciate you taking the time to share your concerns with me.
I understand the concerns you have with the http://www.tsp.gov/features/chapter01.html#sub3Federal Retirement Thrift Investment Board when theychanged trading rules to allow only two interfund transfers per month instead of unlimited transfers. When saving for retirement, I believe that you are far better capable than the government to make important decisions that impact your financial security.
I typically favor allowing investors to have greater freedom and flexibility in this process, so that they can save and prepare for the future. I assure you that I will continue to monitor changes to the TSP and fight for the principles of financial freedom. I will keep the views you have expressed to me in mind if any legislation comes before the House.
I hope you will find this information helpful. Please do not hesitate to contact us with any other concerns or questions you may have. You can reach us by phone at (202) 225-2676, or by e-mail through our website at http://jordan.house.gov
Show-me
Well-known member
Thanks for the update. At least you go a acknowledgment. I have not hear anything from my numerous letters.
JonesH2O
New member
Just received the following email from Congressmen John F. Tierney. He represents the 6th District of Massachusetts:
Dear :
Thank you for your continued correspondence regarding proposed changes to interfund transfer regulations for federal employees’ Thrift Savings Plan (TSP) accounts reportedly recently put forth by the Federal Retirement Thrift Investment Board. Please know I recognize the seriousness with which you view this issue, and I remain mindful of your concerns. As Congress seeks to address the matter, I shall certainly take your comments into consideration.
Again, thank you for taking the time to weigh in. Please feel free to contact me regarding any matter of concern to you.
Sincerely,
John F. Tierney
Member of Congress
Dear :
Thank you for your continued correspondence regarding proposed changes to interfund transfer regulations for federal employees’ Thrift Savings Plan (TSP) accounts reportedly recently put forth by the Federal Retirement Thrift Investment Board. Please know I recognize the seriousness with which you view this issue, and I remain mindful of your concerns. As Congress seeks to address the matter, I shall certainly take your comments into consideration.
Again, thank you for taking the time to weigh in. Please feel free to contact me regarding any matter of concern to you.
Sincerely,
John F. Tierney
Member of Congress
Thank you for your comments. For the information used during the meeting with the ETAC members, please go to the TSP website. The second bullet at the top will take you to the recommendation memo and the slide presentation. this is the email from tracey ray----i ask her for the same information that she gave the etac board. i can't believe the board look at that infromation and didn't say, is this it!!!!!!!!!! you would think that they would ask for more. i'm shooting an e-mail to my rep. and its not going to pretty
Today in the Washington Post, Federal Diary is an article on TSP. At the end it sings the company line. See below. Where is Woodward and Bernstein when you need them?
But a proposal to limit stock trades to two per month has drawn criticism from employees who have been dubbed "frequent traders" by officials. The TSP currently does not limit the number of stock trades by participants, but frequent trading by about 3,000 participants since 2005 has driven up the plan's administrative expenses, officials said.
An interim rule, which took effect yesterday, authorized Long to ask employees who engaged in frequent trading to stop. The TSP "likely will amend" its regulations this year to permit only two stock trades per month, in keeping with restrictions used by mutual funds and other plans, the rule said.
But a proposal to limit stock trades to two per month has drawn criticism from employees who have been dubbed "frequent traders" by officials. The TSP currently does not limit the number of stock trades by participants, but frequent trading by about 3,000 participants since 2005 has driven up the plan's administrative expenses, officials said.
An interim rule, which took effect yesterday, authorized Long to ask employees who engaged in frequent trading to stop. The TSP "likely will amend" its regulations this year to permit only two stock trades per month, in keeping with restrictions used by mutual funds and other plans, the rule said.
I just think it is time to get a lawyer. This is ridiculous. Down 500 Dow points over a week or so. You can't make an incremental move since youony get two. Know you truly must time the market and only a fool thinks they can do it perfectly!
Think about this scenario: You are fully invested and let's say you have hundreds of thousands of dollars in the C, I , S, and a little in the G and F, whatever the mix doesn't really matter. Now, let's say it appears from your analysis (or your advisor) that the market trend is turning from a bull market to bear market. (October 2007 high? Double top? 50/200 day moving average or one of your own signals or that of your advisor).
If that happens, what are you going to do? Move 1, 2, 3 or 400,000 dollars (whatever you got) all at once? Maybe, but most advisors will tell you to move out over a series of a week or two -- say in two or three moves. Even Jim Cramer, the dancing chicken, says "sell half" or sell a third of a position, or buy 1/2 etc.
And then along the way, the Fed cuts rates, the F Fund recovers as bonds rise and you want to increase your F Fund from say 5% to 10 or 15%.
Then, two to three weeks later, the big scare is over due to Fed intervention, good news, whatever news moves the market. So the market does a complete about face and starts up again. What do you when it is time or your advisor says? You buy back in. All at once if you have a huge amount? Maybe, but more astute pros who are more conservative will buy 1/3 or 1/2 position at a time. If you have $250,000 and move it all at once every time?
Well you may not have done an IFT for several months, but let's pretend the above scenario happened NOW, all in the month of January. With no restrictions you would have used 5 to 7 IFTs. Instead of losing 10 percent ($10K, $20K, $30K?) during this volatile correction your 1 or 2 moves only makes you lose 5% ($5K, $10K, $15K?). Which is better?
Well look at very late July and all of August 2007! This is what happened. But in January 2008 at the end of all this volatility instead of being relatively even, you only get 2 moves! You have to hesitate because you only have TWO moves. That hesitation costs you the big bucks as you have to be sure of your move. You really can only move out once and in once. No one I know every calls the exact peak or valley with this kind of volatility SO YOU HAVE LOST BIG MONEY.
This is not day trading. This is re-allocation and IFTs to market conditions to protect what is possibly your largest asset. But TSP wants you to buy and hold and suck up the losses, or give up all together and sit in G or L funds. And in the L funds you will still lose money in a down market.
So -- we save the TSP couch potato ‘buy and hold’ preaching staff all kinds of work and they are joyous and get big raises for their “success.” But we lose big when it could have been prevented! We are also subsidizing the TSP participant who pays no attention to their accounts (another couch potato type.)
And all in the name of fiduciary duty. The fact is the TSP is NEGLIGENT in their duty by not studying ALL alternatives. The are GROSSLY NEGLIGENT because of this, they single out people for harm by restricting them to mail transfer, compounding the harmful gross negligence. Is it not their fiduciary duty to study all alternatives and take an incremental approach on many fronts if they feel they must (questionable) lowering costs?
Did they look at changing the I fund investment vehicle? Limiting rebalancing of L funds to 2 per month? A study of a new I fund with 300-500 stocks or an index instrument or combo instead of 1100 stocks in the present I Fund? Retiming their valuation of the I and other funds?
NO! Let's just screw the participants that educate themselves, pay attention or pay an advisor or a service to tell them what to do! Now that is not executing your duty, that is NEGLIGENCE that truly harms everyone!
Think about this scenario: You are fully invested and let's say you have hundreds of thousands of dollars in the C, I , S, and a little in the G and F, whatever the mix doesn't really matter. Now, let's say it appears from your analysis (or your advisor) that the market trend is turning from a bull market to bear market. (October 2007 high? Double top? 50/200 day moving average or one of your own signals or that of your advisor).
If that happens, what are you going to do? Move 1, 2, 3 or 400,000 dollars (whatever you got) all at once? Maybe, but most advisors will tell you to move out over a series of a week or two -- say in two or three moves. Even Jim Cramer, the dancing chicken, says "sell half" or sell a third of a position, or buy 1/2 etc.
And then along the way, the Fed cuts rates, the F Fund recovers as bonds rise and you want to increase your F Fund from say 5% to 10 or 15%.
Then, two to three weeks later, the big scare is over due to Fed intervention, good news, whatever news moves the market. So the market does a complete about face and starts up again. What do you when it is time or your advisor says? You buy back in. All at once if you have a huge amount? Maybe, but more astute pros who are more conservative will buy 1/3 or 1/2 position at a time. If you have $250,000 and move it all at once every time?
Well you may not have done an IFT for several months, but let's pretend the above scenario happened NOW, all in the month of January. With no restrictions you would have used 5 to 7 IFTs. Instead of losing 10 percent ($10K, $20K, $30K?) during this volatile correction your 1 or 2 moves only makes you lose 5% ($5K, $10K, $15K?). Which is better?
Well look at very late July and all of August 2007! This is what happened. But in January 2008 at the end of all this volatility instead of being relatively even, you only get 2 moves! You have to hesitate because you only have TWO moves. That hesitation costs you the big bucks as you have to be sure of your move. You really can only move out once and in once. No one I know every calls the exact peak or valley with this kind of volatility SO YOU HAVE LOST BIG MONEY.
This is not day trading. This is re-allocation and IFTs to market conditions to protect what is possibly your largest asset. But TSP wants you to buy and hold and suck up the losses, or give up all together and sit in G or L funds. And in the L funds you will still lose money in a down market.
So -- we save the TSP couch potato ‘buy and hold’ preaching staff all kinds of work and they are joyous and get big raises for their “success.” But we lose big when it could have been prevented! We are also subsidizing the TSP participant who pays no attention to their accounts (another couch potato type.)
And all in the name of fiduciary duty. The fact is the TSP is NEGLIGENT in their duty by not studying ALL alternatives. The are GROSSLY NEGLIGENT because of this, they single out people for harm by restricting them to mail transfer, compounding the harmful gross negligence. Is it not their fiduciary duty to study all alternatives and take an incremental approach on many fronts if they feel they must (questionable) lowering costs?
Did they look at changing the I fund investment vehicle? Limiting rebalancing of L funds to 2 per month? A study of a new I fund with 300-500 stocks or an index instrument or combo instead of 1100 stocks in the present I Fund? Retiming their valuation of the I and other funds?
NO! Let's just screw the participants that educate themselves, pay attention or pay an advisor or a service to tell them what to do! Now that is not executing your duty, that is NEGLIGENCE that truly harms everyone!
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I thought I would share this information with the forum. I don't know if this is helpful or not in our efforts to stop the proposed IFT restrictions.
Last year about this time, I noticed that the L Income share price didn't seem to change on a day to day basis as the TSP literature suggested it should. I wrote a FOIA request asking for the August 2005 L Income share price calculations. I received a reply from the FRTIB stating that the information I had requested didn't exist. Never the less, in a follow up to my FOIA request, I was contacted by two employees of the FRTIB. They were quite helpful. The end result was that I learned how the L funds share prices are theoretically calculated each day, and how residuals (portions of a cent) are carried over to the next day. I also learned that the L funds share prices lag the theoreticallly calculated return because of "significant inflows of cash" when the funds were first started, AND that "the exact target allocations for each fund are never actually achieved every day". I accepted the FRTIB explanation for the lag between the actual L funds share prices and the theoretically calculated prices. However, this is not consistant with the TSP literature about the L funds. That literature implies that a shareholder rebalancing their account on a daily basis to a specific L fund allocation might be able to duplicate that specific L fund performance, but it would be difficult and time consuming. What they don't state is that a shareholder who rebalances their account on a daily basis to a specific L fund allocation would do BETTER than the actual L fund performance. Of course, the 2 IFT per month limit will prevent that type of daily rebalancing. Here are a few specific months of my calculations for all the L funds. These are monthly averages of the daily lag amount.
For the month of December 2005 (only the fifth month of the L funds existance), the average lag of the L Income fund share price from the theoretical price was 1.883 cents. The lag for the rest of the L funds share prices for December 2005 were L2010 1.603 cents, L2020 1.536 cents, L2030 1.702 cents, and L2040 1.619 cents. For the month of December 2006, the lag for each fund had increased to L Income 2.175 cents, L2010 2.238 cents, L2020 2.265 cents, L2030 2.423 cents, and L2040 2.438 cents. For the month of December 2007, the lag for each fund had increased to L Income 2.454 cents, L2010 2.452 cents, L2020 2.627 cents, L2030 2.962 cents, and L2040 2.971 cents. Clearly, the FRTIB is not doing the best possible job in their daily reallocation of the L funds, but their solution is to make sure TSP shareholders cant either!
Last year about this time, I noticed that the L Income share price didn't seem to change on a day to day basis as the TSP literature suggested it should. I wrote a FOIA request asking for the August 2005 L Income share price calculations. I received a reply from the FRTIB stating that the information I had requested didn't exist. Never the less, in a follow up to my FOIA request, I was contacted by two employees of the FRTIB. They were quite helpful. The end result was that I learned how the L funds share prices are theoretically calculated each day, and how residuals (portions of a cent) are carried over to the next day. I also learned that the L funds share prices lag the theoreticallly calculated return because of "significant inflows of cash" when the funds were first started, AND that "the exact target allocations for each fund are never actually achieved every day". I accepted the FRTIB explanation for the lag between the actual L funds share prices and the theoretically calculated prices. However, this is not consistant with the TSP literature about the L funds. That literature implies that a shareholder rebalancing their account on a daily basis to a specific L fund allocation might be able to duplicate that specific L fund performance, but it would be difficult and time consuming. What they don't state is that a shareholder who rebalances their account on a daily basis to a specific L fund allocation would do BETTER than the actual L fund performance. Of course, the 2 IFT per month limit will prevent that type of daily rebalancing. Here are a few specific months of my calculations for all the L funds. These are monthly averages of the daily lag amount.
For the month of December 2005 (only the fifth month of the L funds existance), the average lag of the L Income fund share price from the theoretical price was 1.883 cents. The lag for the rest of the L funds share prices for December 2005 were L2010 1.603 cents, L2020 1.536 cents, L2030 1.702 cents, and L2040 1.619 cents. For the month of December 2006, the lag for each fund had increased to L Income 2.175 cents, L2010 2.238 cents, L2020 2.265 cents, L2030 2.423 cents, and L2040 2.438 cents. For the month of December 2007, the lag for each fund had increased to L Income 2.454 cents, L2010 2.452 cents, L2020 2.627 cents, L2030 2.962 cents, and L2040 2.971 cents. Clearly, the FRTIB is not doing the best possible job in their daily reallocation of the L funds, but their solution is to make sure TSP shareholders cant either!
Wanting and being able to do something are two different things. Sometimes, I think the reporters need to be tried and hung for their misrepresentations.
Mr. Causey are you reading this? By the way, Mr Causey, if you do not participate in the TSP, may I also ask you: What business is it of yours anyway if Congress wanted me to manage my money and set up the TSP system as it has? Mr. Causey, other than making a quick buck on bad reporting, why are you misrepresenting our ability to do "interfund transfers" on our own money? Performing interfund transfers, 4 times a day is stretching the truth don't you think?
L Fund. L is for "Lazy." As Mike Causey says the L Funds are for couch potatoes. I park in the L fund sometimes, like on trips and vacations, uncetainty, etc, but I don't want to be forced into the L funds because I can not make up my own "package" or mix of funds and adjust when the market tells me I need to. Are you going to allow your life long retirement savings to turn into a sack of potatoes? Are you going to allow the TSP Lazy Couch Potatoes to take your money and lose it in the next BEAR MARKET? The "buy and hold" mentality cost C Fund participants a loss of about 50 percent from the March 2000 high to the 2002 low. Every dime they put into the C fund prior to March 2000 still has not recovered to beak even yet! If their were L funds them, 4 of the 5 would have also lost a lot of money. I do not intend to let them to do that to me by default. If I am going to sit as a couch potato, it will be my choice, not theirs! Fight on!
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I sent the following email to FedNewsRadio through their "contact us" site ontheir web page:
Your recent interview on the Thrift Savings Plan was absolutely, unacceptably out of line. Nobody every said that TSP particpants wanted to trade "4 times a day" and it is not my fault your interviewee hasn't done "24 things right in a row in my (his) life." You have totally misrepresented those who seek no limits on interfund transfers. I for one do interfund transfers (not trades) more than 24 times a year. Sometimes none in a month and sometimes six-seven in a month -- and I beat the I Fund average. This is not trading but rebalancing for market conditions. I am not going to move thouands of dollars in a single transfer. The TSP does "trading" (rebalancing) on the 5 L funds everyday which runs up costs. The TSP are unmanged funds, so we must manage them. You yourself in your interview said the L funds are for "couch potatoes." So TSP wants to penalize me because I won't sit back and let my UNMANAGED TSP account worth hundreds of thousands of dollars turn into a sack of potatoes to make their job easier? Why have thy not exercised their fiduciary duty and found and explored all other avenues? They have not, yet they say this one action exercises this duty when in fact they are harming their customers that are not L fund "couch potatoes." Get both sides correctly next time.
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James48843
Well-known member
No- they said before it would be included in the annual statement, which gets mailed in February.
