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Subject:  Re: fiscal cliff Date:  12/4/2012  11:50 PM
Author:  Howie52 Number:  174931 of 178762

"Why are Social Security and Medicare being included in these negotiations. "


First question: What negotiations?

Second question: What is different compared to when the "cliff" was
part of the negotiations to increase the debt ceiling limit? Other
than extraordinary additional debts?

Third question: What do you feel is the impact of the Fed buying our
own bonds?

Fourth question: What is the difference between an expenditure that
is paid by government sale of bonds to repay obligations incurred
from prior dealings and any other "bond" payment?

Fifth question: What did the bondholders holding GM debt get back
of their principle?

Sixth question: What are the Greek bondholders likely to get from their

Seventh question: What level of debt do you suppose will constitute
the level where there will never be a serious ability to pay back the

A thumbnail sketch -
Government obligations require a commitment of funds - of revenue.
If these commitments are not funded - someone is left holding the
bag at some point.
Bonds pay interest to account for risk to principle - but
bond yields are being "artificially" fixed such that the inherent
"risk" is not covered.
This is not a stable approach.
Unstable approaches fail.
If the government continues in the current path, the government
will fail.
There is no social security if the government fails.
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