The United States is going to attack Assad in Syria?

[hemet dennis]

Quote:
All accounting is numbers on a ledger. Money is just a piece of paper...a IOU...Are you saying that bonds and notes are just accounting gimmicks ?
Does the government owe SS $2.6 trillion or not ? Saying that the government will have to shut down if the debt ceiling isn't raised is the big lie. The Government will still collect over three fourths of there spending, so at worst one fourth of the government would be shutdown.

The government isn't going to take peoples 401K's and IRA's, people would just stop putting money in them. How will that be a steady stream ?

The government does owe SS just as they owe China or anyone else that holds T-Notes. Investors have been getting out of emerging markets bonds in anticipation of higher rates in treasuries. Those emerging markets have had to raise their rates to attract investors, like China. China is more willing to take a higher risk for higher rates then most investors.
Now if you want to go long or to short bonds then you would want to go with an ETF like IEF or PST, they trade like stocks and makes it a lot easier. At this time I would go with the PST.
Japan has had to sell treasuries to back up their currency, they don't like it to be more then a 100 to the dollar.

Anyway I have to do payroll tomorrow, so not my best day of the week. Then I get what's left Saturday, and sometimes there is some.

 

[Teery]

All accounting is numbers on a ledger. Money is just a piece of paper...a IOU...Are you saying that bonds and notes are just accounting gimmicks ?
Does the government owe SS $2.6 trillion or not ? Saying that the government will have to shut down if the debt ceiling isn't raised is the big lie. The Government will still collect over three fourths of there spending, so at worst one fourth of the government would be shutdown.

The government isn't going to take peoples 401K's and IRA's, people would just stop putting money in them. How will that be a steady stream ?

The government does owe SS just as they owe China or anyone else that holds T-Notes. Investors have been getting out of emerging markets bonds in anticipation of higher rates in treasuries. Those emerging markets have had to raise their rates to attract investors, like China. China is more willing to take a higher risk for higher rates then most investors.
Now if you want to go long or to short bonds then you would want to go with an ETF like IEF or PST, they trade like stocks and makes it a lot easier. At this time I would go with the PST.
Japan has had to sell treasuries to back up their currency, they don't like it to be more then a 100 to the dollar.

Anyway I have to do payroll tomorrow, so not my best day of the week. Then I get what's left Saturday, and sometimes there is some.

The government defaults on its debt if the ceiling isn't raised I didn't say it shuts down however, a good portion of it may. Are you going to work for someone not paying you? Are you going to sell a product you are not going to get paid for? Congress would have to pick and choose what they fund.

Yes, the government owes social security. Have them deposit the 2.6 trillion into the account at Chase Bank..Oh wait, they would have to borrow it adding to the debt..right? I guess the 26 years of funding social security is a myth. I guess the money will just have to stay on the ledger..You see, the government accounting gimmick is red ink deposits, there is no cash deposits which would be required of a normal business.

The government won't take 401K and IRA? in 1933 the government confiscated gold...to suggest they won't do something like tap into retirement accounts is nuts. Desperate times require desperate measures and requiring 401K and IRA to hold treasuries is a source of funding. Governments that are on there way to default will do whatever it takes.

Bonds and notes are loans, IOU's..Financial contracts..

Japan didn't sell to back there currency...Japan has been trying to devalue there currency for a decade. They have inflated the crap out of it. They need to do this to get there exports rolling again. The problem is, the rest of the world is devaluing there currencies as well.

Large bond market investors don't use ETF's, they create them. ETF's were created for rookie investors. You don't need ETF's to short stocks and bonds, you need capital to cover a margin call should the price moves against the trade.

 

[hemet dennis]

Quote: Only if they choose to default.

If the government decided to borrow the money to pay SS back would that raise the debt ? No it would not. If I borrow $1,000 from bank A and use that to pay off a $1,000 loan with bank B, have I increased my debt ? No, I still owe $1,000, but now I owe bank A and not bank B.

Bonds and notes and loans are IOU's

Japan can't let their currency devalue anymore due to the cost of importing energy costs.

Sorry I didn't realize you were a multimillion dollar expert bond trader. But ETF's are good for us people trading under a million dollars.

 

[Fowl_Odor002]

i can print gold

 

[hemet dennis]

i can print gold

Those 3-D printers are cool.

 

[Teery]

Only if they choose to default.

If the government decided to borrow the money to pay SS back would that raise the debt ? No it would not. If I borrow $1,000 from bank A and use that to pay off a $1,000 loan with bank B, have I increased my debt ? No, I still owe $1,000, but now I owe bank A and not bank B.

Bonds and notes and loans are IOU's

Japan can't let their currency devalue anymore due to the cost of importing energy costs.

Sorry I didn't realize you were a multimillion dollar expert bond trader. But ETF's are good for us people trading under a million dollars.

The treasury issued a IOU to the trust that is unrealized or simple put they gave a promise to pay...it didn't add nothing to the debt. In order for them to pay the money they would have to borrow...That is when it is realized and is added to the debt at market interest. Japan is going to default but before they do so, they may offload foreign reserves (i.e. Bonds.). You don't have to have a million to short bonds or any stock. You do have to have the capital to cover your short position should the trade go against your short position.

 

[hemet dennis]

Wow
So you really don't know that the 2.6 trillion in T-Notes held by Social Security is part of the over $16 trillion debt ? LOL

 

[Teery]

Wow
So you really don't know that the 2.6 trillion in T-Notes held by Social Security is part of the over $16 trillion debt ? LOL

It is part of interagovernmental debt which is a book keeping obligation. There is no market interest being paid on it and no real interest being collected on the trust fund bond (which is 100 billion annually). The government has 70 trillion in unfunded liabilities which is also unrealized so it is not counted as debt. Realized debt is 14 trillion. Unrealized debt is 3.7 trillion and if you want to count the fed's balance sheet which is a government liability add another few trillion. The MBS the fed is buying at a rate of 45 billion a month is not counted as debt but because of the full faith and credit of the U.S. it should actually be counted. Government accounting practices would be fraud if a private corporation was to do it.

The government collects $75B in Social Security taxes deducted from paychecks each month, but only makes Social Security payments of $50B. The $25B balance is spent by the general fund, and a $25B I.O.U. is penciled in on the balance sheet as "Intragovernmental". The trust fund will continue to grow in theory even though there is no money in it...that is until the liabilities outweigh the receipts.... Military and other employee pensions are in the same boat. The trust funds / pensions have no real financial assets. They do have legislative obligations.

In simple terms, the government owes itself. At any time the congress can legislate that obligation away which is likely to occur as the debt / interest burden will force them to. Social security will have to be restructured by 2018. They will likely change the age to collect benefits to the death curve average. The last thing the government wants to do is payout. Some Senator that is retiring will attach a rider to a appropriations bill in a conference committee that has been passed. This way, from a political standpoint the politicians can say they didn't vote on it. Changing the age on social security will not help the debt burden much unless they change medicare as well. It also won't change the debt on the books which is the immediate problem when interest rates rise.

 

[hemet dennis]

Quote: Wow
So you really don't know that the 2.6 trillion in T-Notes held by Social Security is part of the over $16 trillion debt ? LOL

You need to get a little more up to date on your facts, SS hasn't been contributing to the general fund.
"In the past, when inflows exceed outflows, the surplus was used to fund other government programs. However, beginning in 2010, deficits have been the rule. The deficits in the past few years were as follows: $49 billion in 2010; $45 billion in 2011; and $55 billion in 2012."
So the government had to pay those amounts to SS from the general fund. And that's what happens when liabilities outweigh the receipts.

When you start legislating away debt it makes it real hard to borrow anymore.

The $2.6 trillion does count against the $16 trillion and is subject to the debt ceiling.

 

[rufus]

http://ncrenegade.com/editorial/por...ion-funds-can-it-happen-in-the-united-states/
http://bwcentral.org/2013/01/the-government-is-planning-to-seize-retirement-accounts/

The Ghirlarducci plan would pay out to everyone, whether they worked and saved or not. But the payout would be miniscule.

Perhaps the safest place for your savings is your mattress. The government through inflation steals the value from the currency. Gold and silver are good, but the government confiscates that. Real estate looks to be the safest investment, but you sure can't run with it when times go bad. I have a safe stuffed with Tsarist bonds and old Chinese currency. I don't have an answer, but I know bad times are on the horizon.

If the US attacks Syria, things will escalate. Gas masks are a hot item in Israel now. The government issues them to Israelis; the Palestinians are on their own.

No matter who wins in Syria, the US will be the villain and the Israelis will take the worst hit. It is time for Obama to call those ships back, and he should take another vacation. We need to butt out.