Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: justlurking

So when all of those treasury notes come due were is the money coming from? Or in other words when it’s time for the government (US Treasury) to repay the government (SS trust fund) for its loan how does the government (US Treasury) get the money to repay the government (SS trust fund)?

Well, the answer is simple. Taxes. Your trust fund is a simple minded accounting fiction. Treasury notes are only safe to the extent that armed men will put you in prison if you fail to repay the debt by not paying your required taxes.

If you have a pension from Company F’s pension fund whose only asset is bonds issued by Company F how much pension do you get if F goes broke?


47 posted on 10/28/2015 4:46:53 PM PDT by FreedomNotSafety
[ Post Reply | Private Reply | To 39 | View Replies ]


To: FreedomNotSafety
So when all of those treasury notes come due were is the money coming from?

They are already "due" -- Social Security started redeeming them a few years ago.

But, you almost answered your question:

Well, the answer is simple. Taxes.

If we were running a budget surplus, it would be "taxes". But, since we are still running a budget deficit -- in excess of the amount being redeemed by Social Security, it's effectively from new US Treasury Bonds being sold at auction, and purchased by individual and corporate investors.

53 posted on 10/28/2015 5:05:15 PM PDT by justlurking
[ Post Reply | Private Reply | To 47 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson