Another Bail Out

Sorry folks....sorry U.S. Treasury....when it rains it really seems to pour. The headline today is that Social Security might need a bail out by the U.S. Treasury.... THIS YEAR!

Don't look now. But even as the bank bailout is winding down, another huge bailout is starting, this time for the Social Security system.

A report from the Congressional Budget Office shows that for the first time in 25 years, Social Security is taking in less in taxes than it is spending on benefits.

Instead of helping to finance the rest of the government, as it has done for decades, our nation's biggest social program needs help from the Treasury to keep benefit checks from bouncing -- in other words, a taxpayer bailout.

Uh-oh...bouncing Social Security checks would be a bad thing...and would not help the popularity of Obama or Congress. Oh yeah...did you notice how the article admitted that Social Security taxes collected were being used to finance the rest of government. We really should be upset!!

Now pay close attention to the next few paragraphs;

Social Security hasn't been cash-negative since the early 1980s, when it came so close to running out of money that it was making plans to stop sending out benefit checks. That led to the famous Greenspan Commission report, which recommended trimming benefits and raising taxes, which Congress did. Those actions produced hefty cash surpluses, which until this year have helped finance the rest of the government.

But even then, it was clear the surpluses would be temporary. Now, years earlier than projected, Social Security is adding to the government's borrowing needs, even though the program still shows a surplus on paper.

Did you catch that??..."years earlier than projected"...and "on paper". Remember, that "on paper" is bank jargon for "doesn't exist".

Read this sobering article here; http://finance.yahoo.com/focus-retirement/article/108747/next-in-line-for-a-bailout-social-security?mod=fidelity-readytoretire

So honestly, do we really believe that the Treasury is going to be able to sell more bonds (in addition to the $4.9 trillion they already have to sell) this year?

Now ask yourself a common sense question; what if they can't sell $4.9 trillion of bonds? Can they just pretend they have money? Can they just print some more? Can the just create an illusion in hopes that the public won't lose confidence? Could they hype a bunch of foreign threats in hopes we rally around our Government...instead of impeaching them all??

Yes.