FED Systematically Destroying S.S. & Pensions

One thing even a 12 year old can understand;  when you put money in the bank, it earns interest.  If you have $1000 in the bank at 5%, you will earn $50 that year.

Now let's run that same math by the Social Security Trust Fund.  The fund assumes that it will earn 5% interest on the $billions of IOU's it has in it's trust fund coffers.

So what happens if interest rates are driven down so low by the FED that S.S. can only earn 1.4% over the next decade?  After all, by law they have to invest in U.S. Gov't bonds.

Well, then Social Security will roll up like a wet carpet....in about 10 years.

Last week the mainstream media hailed QE3 as the "quick fix" that the U.S. economy desperately needs, but the truth is that the policies that the Federal Reserve is pursuing are going to be absolutely devastating for our senior citizens. By keeping interest rates at exceptionally low levels, the Federal Reserve is absolutely crushing savers and is systematically destroying Social Security.

Meanwhile, the inflation that QE3 will cause is going to be absolutely crippling for the millions upon millions of retired Americans that are on a fixed income. Sadly, most elderly Americans have no idea what the Federal Reserve is doing to their financial futures. Most Americans that are approaching retirement age have not adequately saved for retirement, and the Social Security system that they are depending on is going to completely and totally collapse in the coming years.

Right now, approximately 56 million Americans are collecting Social Security benefits. By 2035, that number is projected to grow to a whopping 91 million. By law, the Social Security trust fund must be invested in U.S. government securities. But thanks to the low interest rate policies of the Federal Reserve, the average interest rate on those securities just keeps dropping and dropping.

The trustees of the Social Security system had projected that the Social Security trust fund would be completely gone by 2033, but because of the Fed policy of keeping interest rates exceptionally low for the foreseeable future it is now being projected by some analysts that Social Security will be bankrupt by 2023. Overall, the Social Security system is facing a 134 trillion dollar shortfall over the next 75 years. Yes, you read that correctly. The collapse of Social Security is inevitable, and the foolish policies of the Federal Reserve are going to make that collapse happen much more rapidly.

Here; http://www.zerohedge.com/contributed/2012-09-24/fed-systematically-destroying-social-security-and-retirement-plans-millions

Ouch!!  As we have said, Ponzi schemes are awesome if you are one of the early ones to get in and can ride other's money to the top....but Ponzi schemes are awful when they finally get discovered....because the last folks in lose all their money.

Oh well....maybe the real estate market will 'come back'...and we can all get rich on the rising value of our homes! 

Wait a second...if my kids are broke with crushing student loans and few high paying jobs in sight....how are they, or their friends, going to afford to buy my big house in the suburbs?

Something just isn't adding up here.