Do you Social Security fearmongers realize you can't get something for nothing?

[The T]

The Fed doesn't "just print" money, they have to either a) buy securities with it or b) loan it to a bank which has sufficient collateral to pledge.

If the Fed takes $1 and buys a $1 T-Note with it - the supply of T-Notes in the market has gone down and the supply of dollars has gone up - but the net exchange is zero.

I'll take what is QE 1 and II for $1,000 Alex...

They Fed bought treasuries and mortgages.

The FED should be abolished.

And replaced with what exactly?

Try researching the original structure when this Republic was formed. Go from there. And why you are at it? Research the events of 1913 under Wilson and the progressives.

 

[editec]

How is every dollar created balanced by an equal amount of debt?

Second, how the fuck do we create dollars on the first place?

Dude, seriously? When the Fed creates dollars in open market operations, they buy debt. If they buy $1 of debt for a $1 in money, that $1 of debt they now own is balance by the $1 they paid for it that is now in circulation. When money is created by banks, they take deposits, and loan out the cash - leaving behind debt. The money they loan out is new money, but its balanced by the debt owed by it. All of money is essentially loaned into existence. There's a little gold on deposit at the Fed but not much, most of the assets are debt obligations. Even the Fed's gold is technically gold certificates - documents stating the Fed has ownership of gold on deposit at the Treasury - essentially, debt obligations denoniminated in troy oz. instead of $.

I see the problem, you are confusing the concept of money with the physical reality of printed bills and minted coins. There are actually more dollars in circulation than there are dollar bills.

On top of that you are somehow thinking that assets and debts are the same thing. When the fed puts a dollar into circulation it requires that its member banks have assets that are equal to that amount available.

Wrong. Banks get to lend sums that are multiples of their Capitalization.

That is not debt though,

Wrong again. They hold the obligations their debtos made to pay back the debt. They count those promises to pay as as assets (but not as CAP assets) because, in theory, they represent a future revenue stream.

so I am at a loss to figure out how you jump to them buying debt with it. When the fed wants to "create" more money they expand their balance sheets by obtaining more assets.

You are definitely at a losss.

You seem to be telling us that the money supply does not change. It does. And the mechanism that increases that supply of money is called DEBT.

You need to read a book.

I suggest that you start out with "Secrets of the Temple" in oder to understand the Federal Reserve Banking system that is the mechanism that creates money via DEBT.

 

[westwall]

If I die before I retire I won't much give a damn, will I?

That's why its such great insurance - its win-win!

While you are digging yourself deeper how about re-copying what I said and issuing an apology for illegaly altering my post. I give you one day.

 

[Charles_Main]

The Social Security fearmongers constantly bemoan the fact that the investment of excess FICA revenue in obligations of the United States Treasury means the burden of making up the projected shortfalls in FICA will fall on the taxpayer, and hence, the U.S. economy. That is of course - true.

I have to ask - what other domestic investment vehicle could have prevented the burden from falling on the U.S. economy?

If the Trust Funds had been invested in U.S.corporate debt, then it would be U.S. corporations that have to make up the shortfall - thus the burden still falls on the U.S. economy.

If the Trust Funds had been invested in U.S. stocks, the shortfall would be made up for with dividends from U.S.companies and with sale of stock positions to mostly U.S. citizens - thus the burden again, falls on the U.S. economy to make up the shortfall.

If the Trust Funds had been invested in insurance contracts with U.S. insurers -still the burden falls on the U.S. economy.


The alternative would be to invest in assets with large foreign exposure - like commodities, foreign stock and debt, etc. - but then when the Trust Fund runs in the black, its taking U.S. tax revenues and sending them OUT of the country - investing them in foreign nations instead of the U.S. economy - thus STILL the burden falls on the U.S. economy!

So how would you have done it in a manner which does not place the burden on the U.S. economy? BE SPECIFIC

Very simple. They never should have had the right, or ability to borrow from the Trust Fund. Period.

How do you fix it today? Well as I see it there are 4 major problems with SS right now. They are.

1. Over half of every dollar SS pays out is now going to SSD (disability) Recipients. Many of who either never paid anything in, or did not pay much in and will be collecting for a very long time.

2. People are living much longer than expected when the plan was designed.

3. Congress uses the Trust Fund like a bank.

4. The return on peoples investment is very poor.

How do we fix them, well I sure don't have all the answers but here are some thoughts.

1. Split SSD from SSI. Of course we need to fund SSD, society does need to take care of the Disabled, However it should be separated from SSI which was suppose to be a pay as you go Program. I understand this creates a new problem. (coming up with funding for SSD) However it would assure SSI would remain stable, and self sufficient, indefinitely.

2. I favor raising the Retirement age, over cutting benefits. Benefits now are far to little to live on.

3. What ever it takes, Law, or Amendment, What ever. To assure that every single Penny paid into SSI is in an actual Trust fund that is OFF LIMITS. Not to be used for any other purpose other than SSI benefits. This Step ties into the next.

4. If all the money that is suppose to be in the SSI trust fund was actually there, and the Government had it invested in some no risk Vehicles. The Interest the Fund Gains would be substantial. These extra funds could actually mean we might not have to raise the age, or lower Benefits. Current we basically get nothing. No real Interest gain in all that money, and even when we do, for some strange reason its a terribly low %, Like less than 1%. Hell a CD would be a Massive improvement.

Finally dealing with SSD. First off it should be on the Budget, we should see and understand how much it costs. Second, Anyone collecting SSD, and the Children of Deceased parents, would be paid out of the SSI trust fund up to the point that any monies they had paid in, or their Parent had paid in, is exhausted. At that point they would then go on SSD, Which as I said would be funded through the General Budget.

Some of it's funding would come from the fact that if you separate SSI and SSD it means we could take roughly Half as much as we do now out of peoples checks to fund the SSI trust fund. Which means we could have a new tax that would be about = to the new smaller SSI Tax. Meaning tax wise you have a wash. yet both systems are now separate. SSI is self sufficient, and has an actual trust fund earning a modest Annual Capital gain. Young people could again be confident SSI would be there for them when they get older. Yet the People On SSD would not be forgotten. Any funding for SSD needed beyond the source I Described above we would have to figure out how to come up with. Either through New Revenue or Spending Cuts of course. So I admit it's not a perfect plan, But I think it is a very quick, and simple way to reassure America about SSI's Future Stability.

 

[Quantum Windbag]

I see the problem, you are confusing the concept of money with the physical reality of printed bills and minted coins.

No, I'm not.

There are actually more dollars in circulation than there are dollar bills.

Wow? Really? Honestly, I had no idea! No way dude!!!!


Somehow without even knowing that's what I was thinking, apparently.



Or it requires a dollars worth of securities. Its all the same whether they take nominal possession or whether they have it as collateral.

That is not debt thugh, so I am at a loss to figure out how you jump to them buying debt with it.

Do you think the Fed just gives banks money for nothing? THEY HAVE TO PAY IT BACK. That's called a debt.

When the fed wants to "create" more money they expand their balance sheets by obtaining more assets.

They buy debt obligations. Every dollar in the money supply is backed by a dollar of debt.

You are talking about quantitative easing, which puts more money into circulation when the central bank buys assets to expand its balance sheets. One of the things they buy is debt obligations, but those already existed. Buying them dos not increase the debt because the Fed cannot buy them directly from the Treasury. In fact, they actually reduce the debt in a world where we do not immediately spend money when it comes available.

Additionally, the Treasury can actually increase the money supply by printing more money, which is not an issuance of debt, nor does it require anyone to purchase it. If we did not have to worry about inflation the Treasury could print a billion dollars a week and throw it into circulation.

Ever dollar in the federal reserve system is backed up with an equal value in assets, some of which are debts, but some are actual real assets. That is the way we do things, but it is not required in order to print money, nor is it a physical law.

 

[The T]

The Social Security fearmongers constantly bemoan the fact that the investment of excess FICA revenue in obligations of the United States Treasury means the burden of making up the projected shortfalls in FICA will fall on the taxpayer, and hence, the U.S. economy. That is of course - true.

I have to ask - what other domestic investment vehicle could have prevented the burden from falling on the U.S. economy?

If the Trust Funds had been invested in U.S.corporate debt, then it would be U.S. corporations that have to make up the shortfall - thus the burden still falls on the U.S. economy.

If the Trust Funds had been invested in U.S. stocks, the shortfall would be made up for with dividends from U.S.companies and with sale of stock positions to mostly U.S. citizens - thus the burden again, falls on the U.S. economy to make up the shortfall.

If the Trust Funds had been invested in insurance contracts with U.S. insurers -still the burden falls on the U.S. economy.


The alternative would be to invest in assets with large foreign exposure - like commodities, foreign stock and debt, etc. - but then when the Trust Fund runs in the black, its taking U.S. tax revenues and sending them OUT of the country - investing them in foreign nations instead of the U.S. economy - thus STILL the burden falls on the U.S. economy!

So how would you have done it in a manner which does not place the burden on the U.S. economy? BE SPECIFIC

Very simple. They never should have had the right, or ability to borrow from the Trust Fund. Period.

How do you fix it today? Well as I see it there are 4 major problems with SS right now. They are.

1. Over half of every dollar SS pays out is now going to SSD (disability) Recipients. Many of who either never paid anything in, or did not pay much in and will be collecting for a very long time.

2. People are living much longer than expected when the plan was designed.

3. Congress uses the Trust Fund like a bank.

4. The return on peoples investment is very poor.

How do we fix them, well I sure don't have all the answers but here are some thoughts.

1. Split SSD from SSI. Of course we need to fund SSD, society does need to take care of the Disabled, However it should be separated from SSI which was suppose to be a pay as you go Program. I understand this creates a new problem. (coming up with funding for SSD) However it would assure SSI would remain stable, and self sufficient, indefinitely.

2. I favor raising the Retirement age, over cutting benefits. Benefits now are far to little to live on.

3. What ever it takes, Law, or Amendment, What ever. To assure that every single Penny paid into SSI is in an actual Trust fund that is OFF LIMITS. Not to be used for any other purpose other than SSI benefits. This Step ties into the next.

4. If all the money that is suppose to be in the SSI trust fund was actually there, and the Government had it invested in some no risk Vehicles. The Interest the Fund Gains would be substantial. These extra funds could actually mean we might not have to raise the age, or lower Benefits. Current we basically get nothing. No real Interest gain in all that money, and even when we do, for some strange reason its a terribly low %, Like less than 1%. Hell a CD would be a Massive improvement.

Finally dealing with SSD. First off it should be on the Budget, we should see and understand how much it costs. Second, Anyone collecting SSD, and the Children of Deceased parents, would be paid out of the SSI trust fund up to the point that any monies they had paid in, or their Parent had paid in, is exhausted. At that point they would then go on SSD, Which as I said would be funded through the General Budget.

Some of it's funding would come from the fact that if you separate SSI and SSD it means we could take roughly Half as much as we do now out of peoples checks to fund the SSI trust fund. Which means we could have a new tax that would be about = to the new smaller SSI Tax. Meaning tax wise you have a wash. yet both systems are now separate. SSI is self sufficient, and has an actual trust fund earning a modest Annual Capital gain. Young people could again be confident SSI would be there for them when they get older. Yet the People On SSD would not be forgotten. Any funding for SSD needed beyond the source I Described above we would have to figure out how to come up with. Either through New Revenue or Spending Cuts of course. So I admit it's not a perfect plan, But I think it is a very quick, and simple way to reassure America about SSI's Future Stability.

All true.

 

[The T]

If I die before I retire I won't much give a damn, will I?

That's why its such great insurance - its win-win!

While you are digging yourself deeper how about re-copying what I said and issuing an apology for illegaly altering my post. I give you one day.

And if he doesn't? NAIL his ass to the table.

 

[Quantum Windbag]

The Fed doesn't "just print" money, they have to either a) buy securities with it or b) loan it to a bank which has sufficient collateral to pledge.

If the Fed takes $1 and buys a $1 T-Note with it - the supply of T-Notes in the market has gone down and the supply of dollars has gone up - but the net exchange is zero.

The fed does not print money at all.

The phrase "printing money" is a figurative phrase. I'm surprised you don't know that.

One fed operation is about as close to printing money as you can get - buying foreign currency.

I know it is figurative, I also know buying foreign currency is as far from it as it gets, figuratively or literally.

 

[Quantum Windbag]

Dude, seriously? When the Fed creates dollars in open market operations, they buy debt. If they buy $1 of debt for a $1 in money, that $1 of debt they now own is balance by the $1 they paid for it that is now in circulation. When money is created by banks, they take deposits, and loan out the cash - leaving behind debt. The money they loan out is new money, but its balanced by the debt owed by it. All of money is essentially loaned into existence. There's a little gold on deposit at the Fed but not much, most of the assets are debt obligations. Even the Fed's gold is technically gold certificates - documents stating the Fed has ownership of gold on deposit at the Treasury - essentially, debt obligations denoniminated in troy oz. instead of $.

I see the problem, you are confusing the concept of money with the physical reality of printed bills and minted coins. There are actually more dollars in circulation than there are dollar bills.

On top of that you are somehow thinking that assets and debts are the same thing. When the fed puts a dollar into circulation it requires that its member banks have assets that are equal to that amount available.

Wrong. Banks get to lend sums that are multiples of their Capitalization.

Yes, banks can do that, as long as they are not Federal Reserve banks.

That is not debt though,

Wrong again. They hold the obligations their debtos made to pay back the debt. They count those promises to pay as as assets (but not as CAP assets) because, in theory, they represent a future revenue stream.

so I am at a loss to figure out how you jump to them buying debt with it. When the fed wants to "create" more money they expand their balance sheets by obtaining more assets.

You are definitely at a losss.

You seem to be telling us that the money supply does not change. It does. And the mechanism that increases that supply of money is called DEBT.

You need to read a book.

I suggest that you start out with "Secrets of the Temple" in oder to understand the Federal Reserve Banking system that is the mechanism that creates money via DEBT.[/QUOTE]

Federal Reserve member banks operate under a different set of rules than banks. One of those rules is that those banks have assets equal to the amount of dollars they have in circulation.

One of the methods central banks use to increase money supply is through the purchase of debt. That is not the only way they have to do so, and generally only do so as a last resort when other methods have failed to achieve desired results.

 

[whitehall]

The democrat party fear mongers went crazy when Bush suggested that Americans be allowed to invest a portion of their FICA taxes in the Stock Market. Democrats wanted it all. Statistics say that Black men are more likely to die before being eligible to collect social security and Bush's plan would have allowed people to will a portion of their heirs if they don't live long enough to colledt. Democrats managed to convince most of their mind numbed Black followers that what was good for them was bad and the plan was scrapped. All pensions are invested in the stock market and municipal pensions are still solvent despite the fluctuations in the market. The same can't be said for social security because...THE FREAKING FEDERAL GOVERNMENT SPENDS IT ALL. There is no locked box and sooner or later the burdon on todays taxpayers will be too high to cover the cost of the program that the feds squandered.

 

[OohPooPahDoo]

I'll take what is QE 1 and II for $1,000 Alex...

They Fed bought treasuries and mortgages.

The FED should be abolished.

And replaced with what exactly?

Try researching the original structure when this Republic was formed. Go from there.

Try explaining things to other people instead of just commanding them to go and think like you do - and go from there.... I know its a cliche - but if you can't explain something yourself, you haven't learned it at all.

And why you are at it? Research the events of 1913 under Wilson and the progressives.

Why? Because you have no fucking clue whatsoever what the bank structure was like before 1913, so couldn't possibly explain why it was any better? I do apologize for not having gaping holes in my knowledge of American history like you so clearly do, my bad.

 

[OohPooPahDoo]

. Many of who either never paid anything in[/B], or did not pay much in and will be collecting for a very long time.

Uhh, actually, you're wrong. There's only one way to get SSDI without haven't paid into it. It requires
a) you are disabled before being old enough to enter the workforce
b) your parents have paid enough in to be eligible
c) your parents are currently drawing social security disability or retirement.

So d) you're an obviously ignorant fucktard and there's no point in me reading the rest of your stupid post, and if you don't get the concept of insurance, I can't help you there. (OMG! Some folks buy only one year's premium of a homeowners policy - and wind up getting paid for a whole house! The horror!)

 

[OohPooPahDoo]

You are talking about quantitative easing, which puts more money into circulation when the central bank buys assets to expand its balance sheets.

Call it whatever you like.

One of the things they buy is debt obligations, but those already existed. Buying them dos not increase the debt because the Fed cannot buy them directly from the Treasury. In fact, they actually reduce the debt in a world where we do not immediately spend money when it comes available.

Agreed. By buying the debt they remove it from the market- from circulation -and replace it with money. They monetize the debt.

Additionally, the Treasury can actually increase the money supply by printing more money, which is not an issuance of debt, nor does it require anyone to purchase it.

Wrong. Every dollar the Fed issues is a liability to the Fed.

Ever dollar in the federal reserve system is backed up with an equal value in assets, some of which are debts, but some are actual real assets.

Finally we agree on something.

That is the way we do things, but it is not required in order to print money, nor is it a physical law.

Sure. I guess the government could just print it at will and pay for shit that way - it wouldn't be worth much then, would it?

 

[OohPooPahDoo]

The fed does not print money at all.

The phrase "printing money" is a figurative phrase. I'm surprised you don't know that.

One fed operation is about as close to printing money as you can get - buying foreign currency.

I know it is figurative, I also know buying foreign currency is as far from it as it gets, figuratively or literally.

OK.

So the Fed takes $1000 in U.S. dollars, and exchanges it with Britain for X amount of pounds that their bank just printed out of nowhere - and that's not as close to printing money as you can get.


Its like you saying "Hey Ooopoo - I'll give you 1453 QuantumDollars in exchange for you giving me 453 of your oohpoo bucks - and then we can both claim the issuance of our money was backed by something"

 

[OohPooPahDoo]

I suggest that you start out with "Secrets of the Temple" in oder to understand the Federal Reserve Banking system that is the mechanism that creates money via DEBT.

The National Bank system did the same exact thing all the way back to 1865 or so - they traded dollars issued by their bank for federal or state debt, specie - whatever they wanted - in addition to loaning deposits.. The only difference was lack of centralization.

 

[OohPooPahDoo]

The democrat party fear mongers went crazy when Bush suggested that Americans be allowed to invest a portion of their FICA taxes in the Stock Market.

When you can explain how current beneficiaries would have been funded without a tax hike - let us all know. Thanks!

 

[editec]

I see the problem, you are confusing the concept of money with the physical reality of printed bills and minted coins. There are actually more dollars in circulation than there are dollar bills.

On top of that you are somehow thinking that assets and debts are the same thing. When the fed puts a dollar into circulation it requires that its member banks have assets that are equal to that amount available.

Wrong. Banks get to lend sums that are multiples of their Capitalization.

Yes, banks can do that, as long as they are not Federal Reserve banks.

The banks that own the FED certainly do lend out multiples of their capitalization, amigo.

 

[westwall]

While you are digging yourself deeper how about you grab a pole for me to shove up my ass and then lick it afterwards.

GROSS! No thanks ASSHOLE!

Remember what I told you about editing other peoples comments dickhead. Goodbye.

 

[westwall]

This is how a supposed Doctoral candidate in physics responds to his betters when they point out his offensive and illegal beahavior.

"OohPooPahDoo "How about you suck my cock instead you twat bitch?"

Physics PhD? I think not. This moron sounds an awful lot like spiderman tuba or tuber or whatever he was. I guess the twit doesn't learn too well.

 

[Quantum Windbag]

You are talking about quantitative easing, which puts more money into circulation when the central bank buys assets to expand its balance sheets.

Call it whatever you like.

If I was calling it what I like it would be a lot less polite.

Agreed. By buying the debt they remove it from the market- from circulation -and replace it with money. They monetize the debt.

They are taxing on creditors and redistributing of that tax to debtors. It increases inflation and devalues the dollar. Which is why it is only used as a last resort, and why it is not being done right now. Current debt is not being monetized.

Wrong. Every dollar the Fed issues is a liability to the Fed.

That is because the Fed gets the money from the Treasury.

Finally we agree on something.

Only because you edited my answer.

Sure. I guess the government could just print it at will and pay for shit that way - it wouldn't be worth much then, would it?

It is not worth much anyway, which is the point I am making.