IMF Advocates Taking Pensions & Extending Maturities of Gov’t Debt (Congress, Dodd)
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For anybody that has been following. The 2010 Governance reforms agreed upon appear to be being forced into application very heavily by all members, but a seeming handful of congress. These will be very big changes. We have seen other IMF papers coming out over the last year discussing options for sovereign debt, as well. Such as a "wealth tax". Well here appears to be the newest one. The linked IMF paper is worth reading imo.
Keep in mind Ukraine was being used to push these reforms.
quote: debt is considered sustainable, but not with high probability, the Fund would be able to provide exceptional access on the basis of a debt operation that involves an extension of maturities (normally without any reduction of principal or interest).
..... improve the prospect of securing sustainability and regaining market access, without having to meet the criterion of restoring debt sustainability with high probability.
People will ignore this thread because they don't think it will happen in the US.
There's near $20 trillion in US retirement accounts.
Congress, DOL and that new Consumer Protection Agency all expressed interest in "managing" it for Americans.
They want to invest all that money in Treasuries and then Americans can get annuities..a nice steady reliable source of retirement income. All "optional" of course came out of each of the 3 government entities.
So it's already been broached by the USG.
Maybe some banker is in a back room working out the details.
Just like some insurance person worked out the Obamacare details behind the scenes.
People will ignore this thread because they don't think it will happen in the US.
There's near $20 trillion in US retirement accounts.
Congress, DOL and that new Consumer Protection Agency all expressed interest in "managing" it for Americans.
They want to invest all that money in Treasuries and then Americans can get annuities..a nice steady reliable source of retirement income. All "optional" of course came out of each of the 3 government entities.
So it's already been broached by the USG.
Maybe some banker is in a back room working out the details.
Just like some insurance person worked out the Obamacare details behind the scenes.
Probably, right, but that would be ignoring important information.
The bail-in approach was already codified in Dodd-Frank. The 2010 IMF reforms are global; the US is the biggest player. As to loading the Pension funds with risk? They are already doing it. What better excuse? Save the pension funds?
Where has alltheRiskgone?
quote:
When the risk blows up next time we won’t have to bail the banks to save our pensions we’ll be able to bail out the Pension funds directly.
...
If you want to refresh your understanding of securitization I wrote a series all about it called Securitization – The Undead Heart of the Shadow Banking System parts 1, 2, and 3.
The Logic Behind The Fed's Overnight Reverse Repo Facility: Not Taking, But Adding Liquidity"
quote: Demand: mandatory central clearing of swaps will increase the demand for Treasury securities to satisfy initial margin requirements over time. Additionally, the SEC’s proposed money market fund reforms would likely induce investors to move cash out of variable NAV institutional prime funds and into fixed NAV government funds, which would be required to invest at least 80% of their assets in short-dated Treasury or agency securities/repos.
Mandatory swap clearing kicks off under Dodd-Frank
quote:
The clearing requirement applies to newly executed swaps, as well as changes in the ownership of a swap.
Market participants electing an exception from mandatory clearing under section 2(h)(7) of the CEA do not have to comply with the reporting requirements for electing the exception until September 9, 2013.
Let's not forget this either. President Obama: If You LikeYourRetirementPlan,YouCan Keep It
quote: I will direct the Treasury to create a new way for working Americans to start their own retirement savings: MyRA. It’s a new savings bond that encourages folks to build a nest egg. MyRA guarantees a decent return with no risk of losing what you put in.
Wait, people still believe their retirement is going to be there for them?
Well, folks still believe in the whole D vs. R farce so I'd expect nothing else.
We are not talking about SS but IRA, 401K, Roth accounts.
You know..YOUR money that you socked away for retirement.
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