Sunday, November 7, 2010

Ponzi promises & priceless gold - Pittsburgh Tribune-Review

Ponzi promises & priceless gold - Pittsburgh Tribune-Review:
"n August, Boston University Professor Laurence Kotlikoff wrote an article in the Finance and Development Journal of the International Monetary Fund titled 'U.S. Is Bankrupt and We Don't Even Know It.'

In it he warned: 'Let's get real. The U.S. is bankrupt. He estimated that 'Based on the Congressional Budget Office's data ... a fiscal gap of $202 trillion (exists already), which is 15 times the official Treasury debt.'

Last week, the Federal Reserve announced its intention to print another $600 billion plus to subsidize further the greatest Ponzi scheme in history called the U.S. Treasury market. What does it mean for ordinary Americans?

The fiscal gap is the difference between existing values of the government's revenues and its total obligations, including unfunded liabilities for Social Security, health care, Medicare, Medicaid and government duties such as defense, law and order, justice and public-sector pensions.

The massive government spending and entitlement programs of recent decades have been funded largely on paper. This postponement of real financing has resulted in a massive transfer of wealth not from rich to poor but from all young and even as yet unborn Americans to today's citizens. America now has 78 million baby boomers. Their entitlements will be about $4 trillion each year."

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