When foreigners no longer buy T-Bills, force your own citizens

[dbarberic]

From Investment News.

http://www.investmentnews.com/apps/p.../REG/310139971

Under Ms. Ghilarducci's plan, all workers would receive a $600 annual inflation-adjusted subsidy from the U.S. government but would be required to invest 5% of their pay into a guaranteed retirement account administered by the Social Security Administration. The money in turn would be invested in special government bonds that would pay 3% a year, adjusted for inflation.

The current system of providing tax breaks on 401(k) contributions and earnings would be eliminated.

A few wise commentators out there have been speculating that when “push comes to shove”, that the government will go after retirements accounts for funding. Puplava has speculated more than a few times that there would be some kind of requirement that retirement accounts invest in government bonds.

Looks like the groundwork is being formed. :eek:

[don]

Re: When foreigners no longer buy T-Bills, force your own citizens

A virtuous circle. Mandatory Federal investments with new Wall Street fees generated by managing these SS accounts. What's not to like. :mad:
FIRE!

[phirang]

Re: When foreigners no longer buy T-Bills, force your own citizens

Time to move on to fatter hosts: the proles are scared out of equities.

[Honzajs119]

Re: When foreigners no longer buy T-Bills, force your own citizens

Taiwan Dumps Fannie, Freddie.

http://online.barrons.com/article_em...DgyMjQ0Wj.html

Now Washington might well worry about who lost Taiwan as a major investor in U.S. agency securities as the Republic of China has openly questioned their credit quality -- even after the federal government has committed hundreds of billions of dollars to bail out mortgage giants Fannie Mae and Freddie Mac.
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I think it is possible that foreign government do not want to influence presidential elections. In this case they could start dumping dollars (bonds) just AFTER elections. But to make new president at least partly "safe", they could do it before he officially stepped in on January 20.

Is it stupid idea or not?

[Kimmons]

Re: When foreigners no longer buy T-Bills, force your own citizens

I'm sorry, don't I already pay 7.5% to SS?

An additional 5% (proposed) so I can have some of these "special bonds" so later the gooberment can default on them or inflate them away? Yah, that's a good deal for us! All this from the "professor of economic-policy analysis", what an amazing country.

Isn't this what happened in Argentina? Didn't they plunder retirement accounts, promise bonds or something like them, then default...and poof all retirement gone?

[bpr]

Re: When foreigners no longer buy T-Bills, force your own citizens

Retirement may be a distinctly 20th Century idea.

[Starving Steve]

Re: When foreigners no longer buy T-Bills, force your own citizens

Real world starvation: My California teacher pension is $288 per month for 7.77 years of teaching. My Canada pension is $200 per month. My Canada Old Age Security will be about $300 per month. And my US social security will be $200 after deduction for double-dipping. So, the total of all my micro-pensions will be less than $1000 per month to live on, and that is before income tax.

Is this a sick joke, or what? And meanwhile, the bail-outs to bankers and Wall Street are in the trillions of dollars.

So maybe the idea of seniors investing in 3% real return govn't bonds is a good idea IF the U.S. govn't does NOT lie about the inflation rate. But can we believe Bernankee and Paulson?

If retirement is a quaint 20th C. idea, then how are senior citizens going to be able to continue to work? How can anyone work until they are 90? This is hellish and obscene.

[reallife]

Re: When foreigners no longer buy T-Bills, force your own citizens

StarvingSteve,

Maybe you should become an investment banker. ..... Uh, Oh, too late!:rolleyes:

[bpr]

Re: When foreigners no longer buy T-Bills, force your own citizens

Real world starvation: My California teacher pension is $288 per month for 7.77 years of teaching. My Canada pension is $200 per month. My Canada Old Age Security will be about $300 per month. And my US social security will be $200 after deduction for double-dipping. So, the total of all my micro-pensions will be less than $1000 per month to live on, and that is before income tax.

Is this a sick joke, or what? And meanwhile, the bail-outs to bankers and Wall Street are in the trillions of dollars.

So maybe the idea of seniors investing in 3% real return govn't bonds is a good idea IF the U.S. govn't does NOT lie about the inflation rate. But can we believe Bernankee and Paulson?

If retirement is a quaint 20th C. idea, then how are senior citizens going to be able to continue to work? How can anyone work until they are 90? This is hellish and obscene.

Steve, that wasn't my intention, just an observation. It is hellish and obscene.

I'm sorry I made light of it.

I'm doing pretty well, at 32. I just got engaged, and we should be able to cover the costs ourselves. But I'm not doing well enough to cover my parents at 69. That's going to take a bloody f'n revolution.

Oh, and as for Bernanke and Paulson, I don't expect them to be doling out the soup when the time comes.

[c1ue]

Re: When foreigners no longer buy T-Bills, force your own citizens

Steve,

You may have to move out of LA.

I am in the process of helping an 87 year old woman who survives on Social Security.

The only reason she's not in public housing is that she's in a rent controlled flat - her rent is only $300 in one of the prime areas of town, a 2 BD/1.5 BA flat.

But her utility bills in winter were $180-$280/month; between the $300 rent plus those utility bills vs. her $800 SS income, she was 48 hours from having her utilities turned off.

[phirang]

Re: When foreigners no longer buy T-Bills, force your own citizens

Real world starvation: My California teacher pension is $288 per month for 7.77 years of teaching. My Canada pension is $200 per month. My Canada Old Age Security will be about $300 per month. And my US social security will be $200 after deduction for double-dipping. So, the total of all my micro-pensions will be less than $1000 per month to live on, and that is before income tax.

Is this a sick joke, or what? And meanwhile, the bail-outs to bankers and Wall Street are in the trillions of dollars.

So maybe the idea of seniors investing in 3% real return govn't bonds is a good idea IF the U.S. govn't does NOT lie about the inflation rate. But can we believe Bernankee and Paulson?

If retirement is a quaint 20th C. idea, then how are senior citizens going to be able to continue to work? How can anyone work until they are 90? This is hellish and obscene.

Most people in the world have their parents live with them till they die. The notion of doing otherwise is totally foreign.

Then again, I'm not sold on this crisis, especially now that the media and brokerages are selling it to us.

problem-reaction-solution: works every time.

[Starving Steve]

Re: When foreigners no longer buy T-Bills, force your own citizens

Most people in the world have their parents live with them till they die. The notion of doing otherwise is totally foreign.

Then again, I'm not sold on this crisis, especially now that the media and brokerages are selling it to us.

problem-reaction-solution: works every time.

Trust me: this is a real crisis.

Ten trillion dollars worldwide has already been lost in global stock markets. Then add to that, the real estate crash and the commodities crash, the derivatives crash, the hedge fund crash, etc.... This makes 1929 seem like a joke.

What really ticks me off are Republicans like John McCain who has eleven (11) homes; Republicans such as him have no idea what working people like myself are going through.

To McCain, a daily problem might be: What home shall I have my mail sent to? Or which one of my 11 homes gives me the best tax advantage as a personal residence? Or which home gives me the most money in ethanol grants and federal water subsidies?

[c1ue]

Re: When foreigners no longer buy T-Bills, force your own citizens

Steve,

Your situation sucks, but we're hardly at 1929.

Even the most gloomy aren't predicting 25% unemployment.

As for McCain - I totally agree he's completely out of touch. I had hoped that between his age and his financial situation, that he could shed his Keating 5 behavior and really do something different.

Unfortunately it is quite unclear whether the other scoundrel will do any better.

At least with the Demos having full control - there will be no excuses.

[tastymannatees]

Re: When foreigners no longer buy T-Bills, force your own citizens

I'm sorry, don't I already pay 7.5% to SS?

An additional 5% (proposed) so I can have some of these "special bonds" so later the gooberment can default on them or inflate them away? Yah, that's a good deal for us! All this from the "professor of economic-policy analysis", what an amazing country.

Try being self employed, I pay double that- add 5% and I am pushing 20% add in state and local and federal and I'll be pushing 60% - 70% with all the new taxes planned for us. Throw in mortgage and health care, household basics does not too leave much left on the disposable income side of the equation.

I think most of the "Joe the Plumbers" out there have a pretty good argument...