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Old 02-18-2013, 04:33 AM
 
621 posts, read 596,893 times
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The tax that funds the SS program was been running a surplus for quite some time. That surplus was used to buy T-bills. The plan had been to sell those T-bills to pay for the baby boomers retirement. The problem with that plan now is it looks like the only buyer for those T-bills will be the Fed.


The reasoning behind me saying this is, The Fed is buying 2/3 of the budget shortfall, this is not likely to change, we may get another bubble but we aren't going to get a healthy economy very soon 2 decades out it should still suck unless something unexpected changes take a look at Japan as a model, and we are looking at loosing our status as the world's reserve currency, with that will come a run on USD.


It looks to me like we need a plan to balance the budget and start buying back those T-bills. The alternative is to monetize those T-bills. With the loss of our status as world's reserve currency, that monetization should result in hyper inflation. (We aren't getting hyper inflation now because every one still wants USD for international trade. When that changes our debts will start to be no longer valued in USD, they will start to be valued in something else.)


Here is a plan that I think may work for restructuring our debts so that we can start buying back those T-bills held by the SS administration.


Simultaneously get very low unemployment and a $30 an hour minimum wage.


Put in a freeze on non-inflation adjusted government spending.


Start an enforced savings plan to get balanced trade. This savings would happen in banks or credit unions. (Other trade barriers should be looked at but this one we can do without changing our trade agreements with other nations.)


We need stable government regulations.


This is the kind of thing that I think needs to be done about the problem with the retirement fund held by the SS administration. Any other workable plan that would be less invasive to the economy and personal liberties would be welcome.
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Old 02-18-2013, 04:54 AM
 
86,178 posts, read 83,691,556 times
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now that you have the ill's of the world solved what are you doing to play the cards as dealt to work with what you have?

it is great you have the social security system fixed all by yourself but what is your own personal finance plan doing to deal with things just the way they are ?

to many tmes i see all these efforts ,thoughts and ideas in how to solve the problems posted here and the financial shape of those posting is dismal at best.

i am not saying that is your case but you damn well better put time into your own plan complete with all the ill's of the world is all i am saying.
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Old 02-18-2013, 05:08 AM
 
621 posts, read 596,893 times
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Quote:
Originally Posted by mathjak107 View Post
now that you have the ill's of the world solved what are you doing to play the cards as dealt to work with what you have?

it is great you have the social security system fixed all by yourself but what is your own personal finance plan doing to deal with things just the way they are ?

to many tmes i see all these efforts ,thoughts and ideas in how to solve the problems posted here and the financial shape of those posting is dismal at best.

i am not saying that is your case but you damn well better put time into your own plan complete with all the ill's of the world is all i am saying.
Personally I've got something like 60 ideas for patents that I'm starting to work on. Long term my personal finances are looking good. Short term they suck.

Do you know of anyone else talking about the lack of buyers for T-bills and what it means for those that are retiring?
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Old 02-18-2013, 05:15 AM
 
86,178 posts, read 83,691,556 times
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sure lots of financially ignorant folks are complaining about rates . the fed did everything but drop leaflets from helicopters telling everyone the worlds rates are falling. do not leave any long term money sitting in cash instruments.

those that payed attention and shifted to safe secure treasury bonds reaped huge capital gains and are dancing in the streets just because of the low rates.

i am retiring in 16 months but made the changes from a growth model to the allocations i wanted for retirement years ago. many of us right here use the same popular newsletter i do and i switched to an income model as i got ready for retirement land.

last year my fixed income portfolio which a few of us right here in city data use was up 11% , the year before 9% ,the year before 20% ... and we are talking a very conservative mix but it responds well to falling rates . today it contains 3% stock.

what we all who payed attention did not do is sit with money in cash instruments and do nothing.

it just requires paying attention and getting a little education.

but i don't want to go off topic. you seem like a bright guy and i want to just make you are aware you better plan around what was ,what is, and what may very well be . complaining without planning ususlly leads to financial suicide eventually and that is what most folks in this forum do to themselves.

they blame the dealers but never have a plan for playing the cards. then they blame everyone and everything around them because they either earn so little or accumulate so little.

Last edited by mathjak107; 02-18-2013 at 05:43 AM..
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Old 02-18-2013, 05:44 AM
 
621 posts, read 596,893 times
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Quote:
Originally Posted by mathjak107 View Post
sure lots of financially ignorant folks are complaining . the fed did everything but drop leaflets from helicopters telling everyone the worlds rates are falling. do not leave any long term money sitting in cash instruments.

...

they blame the dealers but never have a plan for playing the cards. then they blame everyone and everything around them because they either earn so little or accumulate so little.
To blame others for your own mistakes is human nature. To pretend everything is OK is also human nature.

The economy and the retirement fund is like a fully loaded semi on a hill. The brakes are smoking the tranny is out of gear and you are above the top speed of the top gear, and there is no runaway truck lane. That truck is going to hit something. What happens is a question of what we chose to hit. Or if we chose to do nothing.
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Old 02-18-2013, 05:56 AM
 
86,178 posts, read 83,691,556 times
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it is always better to try something. even a half-assed plan is better then no plan .

the reality is for 146 years now there has not been a time where we were not faced with doom and gloom but the reality is the doom and gloomers grew poorer or stayed poor and the rest went on to prosper despite those walls of worry.

through it all investing in this country has grown wealth through every generation despite the outlook.

sure one day it can end but i still rather plan around what was , what is and what still has a reasonable chance of continuing. if that fails we are all dead anyway in the end .

i rarely waste time complaining about things. i have opinions about things but rarely do i waste time complaining . 99% of what i post are all ways of dealing with lifes lemons. it is about making lemonade. it is about developing plans to withstand black swan events and even profiting.

you can search any of my 18,000 posts here and they all kind of have the same theme.

i spend lots of time learning about planning around the events or using them to my advantage.

while others complain about the price of oil and gas i did some homework. i found an etf fund that owns loads of barrels of oil. it is called USO

now when oil goes up i make about 100 bucks for evey 1% rise easily hedging my energy costs and not leaving them open ended. if oil drops, great, then i make it back in other things by saving on costs ..

i spent my time learning to make a negative into a positive.

that is what life is about if you want to be succesful. IT IS GREAT TO TAKE UP A CAUSE , BUT YOU NEED A PLAN FOR DEALING WITH THE CAUSE YOU WANT TO HELP IN CASE IT DOES NOT CHANGE .

if all you see is gloom and think you never can do something or achieve something then you never will.

Last edited by mathjak107; 02-18-2013 at 06:18 AM..
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Old 02-18-2013, 06:54 AM
 
Location: Atlanta
4,444 posts, read 4,963,003 times
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I agree with the above. Just do what's best for yourself and let the goobermint fall down on its own...lol.

The best thing we should all hope for is for the goobermint to do nothing in regard to tax rates - according to one active poster on these boards, the FICA rate would need to be raised to 16%+ in order to keep Social Security solvent, which means an actual rate of 32% for both the employer and employee contribution (or the total amount for the self-employed). Now, if such a thing actually came to pass, then we're talking about some serious doom, as the economy would be plunged into endless depression, and the black market economy would rule the day, as who in the world can pay such onerous tax rates??

So yeah, let's keep putting Obamas and Bushes back into office, as they'll never raise tax rates to such obscene levels, and I see this as a GOOD thing, as I can save my own money and save for my own retirement. If Social Security goes broke, so be it, I'll find a way to make do without it.

So let's not rock the boat with insane ideas like a $30/hr min wage - things really aren't SO bad at the moment, so why not just leave it that way and do your own thang?
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Old 02-18-2013, 07:48 AM
 
Location: The Triad (NC)
31,411 posts, read 70,041,818 times
Reputation: 37509
Quote:
Originally Posted by pie_row View Post
The (insurance contribution) that funds the SS program was been running a surplus for quite some time.

That surplus was used to buy T-bills.
The plan had been to sell those T-bills to pay for the baby boomers retirement.
It looks to me like we need a plan to balance the budget and start buying back those T-bills.

This is the kind of thing that I think needs to be done about the problem...
What problem?

Want to talk problems? Look at Medicare/Medicaid.

Quote:
The economy... is like a fully loaded semi on a hill.
More like a 30-40% OVER loaded semi.
Reduce the load to be within capacity... and it'll be just fine.
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Old 02-18-2013, 08:31 AM
 
86,178 posts, read 83,691,556 times
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yep , i am with you on that one. compared to social security the medicare system is a huge concern of mine . the money you are dealing with in social security is chump change in comparison.
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Old 02-18-2013, 08:35 AM
 
86,178 posts, read 83,691,556 times
Reputation: 61933
Quote:
Originally Posted by NorthStarDelight View Post
I agree with the above. Just do what's best for yourself and let the goobermint fall down on its own...lol.

The best thing we should all hope for is for the goobermint to do nothing in regard to tax rates - according to one active poster on these boards, the FICA rate would need to be raised to 16%+ in order to keep Social Security solvent, which means an actual rate of 32% for both the employer and employee contribution (or the total amount for the self-employed). Now, if such a thing actually came to pass, then we're talking about some serious doom, as the economy would be plunged into endless depression, and the black market economy would rule the day, as who in the world can pay such onerous tax rates??

So yeah, let's keep putting Obamas and Bushes back into office, as they'll never raise tax rates to such obscene levels, and I see this as a GOOD thing, as I can save my own money and save for my own retirement. If Social Security goes broke, so be it, I'll find a way to make do without it.

So let's not rock the boat with insane ideas like a $30/hr min wage - things really aren't SO bad at the moment, so why not just leave it that way and do your own thang?
the answer is most can not and will not do their own thang to help themselves. they will complain and complain, they will dream up answers they think are the solutions in their own head. they will believe their own bull-sh&t to be true and the only answer to the problem.

they will do all of the above but never deal with helping themselves to have a personal plan to get through the issues they complain about.

like i say it's always blame the dealer and never play the hand.
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