Coolhand's Market Analysis

Politics will soon take the lead in market movement...

Will the fear (probably to be realized) of a Gubmint Shutdown spook the market more than the hope of turning the tide on the Gubmint Red Tide?

Don't know...

What I do know is that my 17% (now 16%) holdings in the 'G Fund' will help keep the Gubmint checks flowing. I bet the right wing screamers (one would be me) don't realize that some of our assets can be borrowed to cover the cost of Gubmint spending

Wisconsin's Governor may have started a chain reaction much the way Tunisia did, although the issue(s) are different. You can bet a lot of other states (and unions) are watching the theater up there for cues.

Originally Posted by Boghie

Politics will soon take the lead in market movement...

Will the fear (probably to be realized) of a Gubmint Shutdown spook the market more than the hope of turning the tide on the Gubmint Red Tide?

Don't know...

What I do know is that my 17% (now 16%) holdings in the 'G Fund' will help keep the Gubmint checks flowing. I bet the right wing screamers (one would be me) don't realize that some of our assets can be borrowed to cover the cost of Gubmint spending

Originally Posted by Boghie

some of our assets can be borrowed to cover the cost of Gubmint spending

Huh? Does the TSP have government IOUs backing the G Fund? If we all cashed out at once would WE have to take IOUs?

Why would the Gubmint (love the term) have to "borrow" from the G Fund? Don't we already loan it to them when we invest in the G Fund?

I'm pretty sleep deprived right now so perhaps I'm missing the blinding flash of the obvious answer here.

PS I suppose I also qualify as one of those right wing screamers you talk of (though I'd like to see the terms "right" and "left" dissapear from political discourse; they are dangerously misleading).

Cyberzen,

The whole 'G Fund' thang is my pet peeve. CH probably hates me for referencing it…

Anyway, the ‘G Fund’ uses exactly the same very short term government bonds Social Security uses. Those bonds mature very quickly – I think within a week. When they mature the Treasury just rolls the debt into the next set of bonds. Yuk…

So, Social Security and you invest in very short term bonds that are sold only to you and Social Security. Those bonds are NOT available to anyone else. But, unlike Social Security, those bonds are held in YOUR lock box (yuk, yuk). You own them. They are in your name.

But, like the non-existent Social Security trust fund lock box, the assets behind the bonds are accessible to the Treasury. Three times in the past the Treasury has ‘borrowed’ from the ‘G Fund’ to cover expenses while Congress wrangles over the debt ceiling. They then fill that hole with the principle and interest when they regain the authority to borrow more from the Chinese or American Oldsters (who still buy Treasuries). Under normal circumstances the ‘G Fund’ assets are in your lock box.

I wouldn’t worry about it. I am concerned that my short term move to the ‘G Fund’ may lock my holdings up during a government shutdown.

My question was: Can we reallocate ‘G Fund’ assets if the Treasury is borrowing them?

If you haven't read this article before, you should. Everyone who invests in TSP should read it and understand its message. Pay particular attention to the last two paragraphs. The rest of the article helps provide the context.

http://www.fedsmith.com/article/2711...-tsp-fund.html

Originally Posted by Cyberzen

Huh? Does the TSP have government IOUs backing the G Fund? If we all cashed out at once would WE have to take IOUs?

Why would the Gubmint (love the term) have to "borrow" from the G Fund? Don't we already loan it to them when we invest in the G Fund?

I'm pretty sleep deprived right now so perhaps I'm missing the blinding flash of the obvious answer here.

PS I suppose I also qualify as one of those right wing screamers you talk of (though I'd like to see the terms "right" and "left" dissapear from political discourse; they are dangerously misleading).