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Thread: The Govt is monkeying with our savings again

  1. Default The Govt is monkeying with our savings again

    Read in the Stephen Barr column of the Washington Post, that the government is borrowing from our funds again. He said, if I understand correctly, that they are not investing all the money, but, they claim that it will not hurt us. That always makes me uncomfortable. Some years ago a NY senator (now deceased, whose name escapes me) made a big stink about it, but, nothing was changed. Grrr::

  3. #2

    Default Here is a link to another article

    Treasury Dept. Moves to Avoid Debt Limit
    The Associated Press
    Monday, March 6, 2006; 11:29 AM

    WASHINGTON -- Treasury Secretary John Snow notified Congress on Monday that the administration has now taken "all prudent and legal actions," including tapping certain government retirement funds, to keep from hitting the $8.2 trillion national debt limit.


    I wonder if the raid on and ultimate bankruptcy of Social Security began in the same manner. The only thing keeping the U.S. from hitting this debt ceiling earlier was the fact the expense of the Iraqi War was not factored into the budget.


  5. #3


    How often does this happen? Is this just the G fund? Does it get paid back? Is there anything we can do about it? Never heard of this one before. The politicians have really made the federal budget a mess. It would be really nice if they kept their hands off our TSP.

  7. #4


    This is the second time they've done it that I'm aware of and to my knowledge it just involved the G-Fund. I agree...hands off should be the operative word.

  9. #5


    My thought on this is if you don't want the government to use the G fund then why should they give you an interest rate. Basically that is what the fund is it is the cost of the government to use the fund when needed providing you the very safe interest rate with one of the most stable governments in the world. If you don't want the government to use your money maybe one of the other funds is your cats meow.

  11. #6

    Join Date
    Dec 2005
    near Philadelphia, PA


    Quote Originally Posted by Wimpy
    This is the second time they've done it that I'm aware of ....


    In the past, has this been transparent to the TSP investor? (i.e. will the fund continue to recieve it's periodic penny and function normally?)

  13. #7


    As long as they repay the fund with the interest included what is the problem?

  15. #8


    The problem is that it "feels uncomfortable".

  17. #9

    Join Date
    Mar 2004
    Cleveland, OH


    Bernanke will just whip out the printing press and pay the G fund back. Any interest will be low since the government has an unofficial policy of refusing to recognize inflation.

  19. #10

    Join Date
    Jul 2004
    Twin Cities, Minnesota, USA


    While the idea of the government raiding our retirement funds is troubling, the fact of the matter is that as long as the rate of return is unaffected and the funds are available for withdrawal, we really have nothing to complain about.

    If we start seeing stories of TSP participants being unable to take distributions due to the funds being unavailable (since the government already borrowed / spent them), then we have a major problem.

  21. #11

    Default G-Fund Raid

    I think Cortez hit at the underlying aspect of what seems troubling with this arrangement when he said, “Bernanke will just whip out the printing press and pay the G fund back.” In essence, that is what happens when our money is first deposited into our TSP accounts in the G-Fund. It is loaned to the government (when the trustee purchases treasuries on our behalf) at the going interest rate. Much of both interest and principal is paid with printing press money as the deficit clearly indicates.

    By the government ‘raiding’ of this fund, by suspending the issuance of these treasuries in trade for our payroll deductions to the G-Fund, they are establishing a dangerous precedent of ‘under funding’ these accounts as they did with Social Security. I believe Social Security was, at one time, fully funded and now is under funded or bankrupt. Many corporate pensions, once fully funded, are NOW bankrupt…and legally so.

    As sheeple become conditioned to the concept of these ‘raids’ being harmless, it is not much of a leap to convince the sheeple the TSP can function in exactly the same manner as Social Security. In other words, instead of being fully funded it will be funded by New Blood whose salaries are also paid by ‘counterfeit money’. If there is not enough New Blood to support the TSP payouts, the shortfall will be…you guessed it…‘counterfeited’. TSP participation (employee payroll deductions) would no longer be optional in this scenario…they would be mandatory.

    How would you feel about your neighbor taking out a home equity loan to buy a matching set of BMWs and then paying the home equity off with their credit cards and when the credit card statement comes in the mail box, instead of paying it off with something tangible, your neighbor goes into the basement and prints that money to pay off the credit card bills?They’ve essentially ‘counterfeited’ and added paper fiat to the monetary system that was ‘unearned’ or not connected in any fashion to GDP. This devalues the existing currency in circulation causing inflation and the prices YOU pay for consumer goods to rise. You’ve basically subsidized his luxury car purchase. You begin fashioning a hangman’s noose and cry out for justice without even considering the government does the same thing a billion times a day, and in a much more leveraged fashion, when they print paper fiat currency, in excess of GDP, to pay for pork they can’t afford. They are committing the same fraud the guy in the basement is committing. The guy in the basement will go to jail, if caught, while the guys and gals at the FED and treasury will get a bonus…that they better spend very fast.

    The bottom line: You ARE NOT getting back exactly what was stolen (that taken without your consent) the second time around. Matter of fact, you are not getting it back on the first go either, but at least you contractually agreed to that arrangement by depositing your money there. I suppose one could say, with this latest precedent being established, one has agreed to it, by default, for future deposits we give without a corresponding treasury being issued.

    It works for Social Security, why not the TSP, one might ask? Social Security is bankrupt and is totally dependent upon New Blood coming into the system to pay current retirement obligations. These obligations will be increasing several times over in the next two decades. In my mind, this is why the immigration flood gates, legal or otherwise, have been opened up.

    The U.S. is in technical bankruptcy and spending beyond its means. Our TSP accounts, our 401ks, our IRAs, and our pensions have ALL become cash cows, with a gigantic BULLS-EYE painted on them, to these D.C. Desperadoes who will milk them dry in one form or another. Inflation (printing away the debt owed) is one form of milking. Out right confiscation is another. We may very well see both forms of milking before the Triple Deficits are reined in and balanced.

    The greatest wealth transfer in all of history is taking place in front of our very eyes but most of those eyes are glazed over and dulled. They are too busy maintaining their delicate balance inside the financial hamster wheel to even notice they are sucking wind and going nowhere. Through clenched teeth and flared nostrils they say those funds are protected by law. Patriot Act III, IV, V, or VI or some executive order could end the legal protections ‘the law’ currently provides against outright confiscation and all in the name of ‘national security’. But, they don’t need a new Patriot Act to steal your funds via inflation, do they?

    Ultimately, as private sector pensioners are currently learning first hand, the individual investor is responsible for the outcome of their financial decisions. No one has as much of a vested interest in those funds as the individual investor does and it would be extremely unwise to pretend otherwise. If the U.S. Gov’t is unable to protect private sector pensioners, one would be awful arrogant to assume their TSP funds have any absolute guarantee. At best, the math may work out, but in terms of what those funds will actually purchase will most likely leave one on that hamster wheel a few more years than originally anticipated…especially if all one’s financial eggs are in a basket with a humongous bulls-eye painted on it.

    If you currently don’t have any gold to protect yourself from the ravages of inflation, but are holding out for the TSP trustee to add a precious metals fund…don’t hold your breath. There will be a precious metals fund eventually…at the top of the market…but you will buying in at the top…not a good plan.

    There is a way to use your TSP to fund a gold position to insure your remaining funds against the fraud of inflation. Simply take out a TSP loan of 10% of your total TSP assets and go buy some gold. If what I say comes true, your gold will off-set the devaluation of your remaining TSP funds. With insurance you don’t profit from a loss, but simply hope to break even minus the original premium paid. But you really don’t have a whole lot of time…the fuse is very short and is already lit.

    If you believe in gold not only as insurance against inflation, but also believe in gold as a viable investment…increase your gold position NOT with a TSP loan, but rather with cash saved or garnered from selling depreciating assets such as extra and/or expensive cars, snowmobiles, and boats. Cut your overhead and use the extra funds to protect yourself and profit from the marauders who are drooling all over your thrift.

  23. #12


    Very good post Wimpy!

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