There were talks about doing something called “baby bonds” where each child would get a bond from the government and then couldn’t touch it till they turned like 18 and I could see that being a “fantastic” way to offload them on the population… idea seemed to have died once the House flipped in 2022 but before it was talked about quite a bit on the hill
31 sats \ 1 reply \ @TomK OP 7 May
oh my god is that really true? when I was little in Germany, the so-called 'Sparkasse' gave everyone who started school a savings bond with 5 Deutschmarks inside.
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The idea was based off of some other country I think in Europe. I will see if I can find who it was that was a huge proponent of it.
Ah found a link turns out it was reintroduced this Congress as well
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Wow they would be able to offload a bunch. I bet they would be worth almost the same amount after 18 years. That certificate wouldnt be able to keep up with inflation.
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Who has 1k to buy that when they are having a kid?
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31 sats \ 1 reply \ @Cje95 7 May
I’m not sure it’s really a cost since it’s the federal government giving it and they would be off ramping bonds I believe
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Can you imagine the government starting to print their 1000 dollar bills again? I remember a few years back this special one signed by Chase was worth a lot.
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Fed printer go brrr.
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Exactly!
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Thanks
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That's diabolical. I assumed they would put financial requirements on things like pension funds and university trusts that would require them to hold some proportion of US treasuries.
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To be honest I am not sure… I think they could be something that take care of the issue and they wouldn’t need to do that however I could see government pensions being another big off ramp for these bonds as well
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Could they do that? Actually, arent they using social security to prop things up? I think the government has borrowed from it time and time again.
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The social security trust was a fiction to begin with, but even so, it's been in the negative for several years now.
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Isnt it because they borrow from it though? It should be highly positive with all the growth we have had in our economy in the past. Just amazes me how mismanaged the money is.
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Not really, but sort of. There was some fake accounting that was called the social security trust fund, but it was never legally binding in any way and the program was never actually set up to be financially sustainable.
On occasion, politicians have publicly justified their reckless spending as borrowing from that fake trust fund, though.
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It was sustainable as long as the population kept increasing... ironically illegal immigration is really great at helping social security stay afloat since those individuals can never draw down from it
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Just like how pyramid schemes are sustainable.
What I mean is analogous to how defined contribution retirement plans are sustainable, but defined benefit plans are not. There was never a social security trust fund that mechanically contained all of the money or assets that would eventually get paid out. It was always organized like an unfunded liability, even if there was occasionally money somewhere that someone claimed was for social security payments.
Do illegal immigrants actually pay into it though?
Yeah, I hear it on the fake news quite a bit. Actually, I remember an old coworker complaining that it isnt money the government should be touching.
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I mean all the worlds money is whats funny is that the US is one of the best at it given its economic size compared to China and India.
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Its just because the dollar is trusted. Once it loses that trust, it will be a massive free for all.
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10 sats \ 1 reply \ @Cje95 7 May
I would agree however one thing I have learned is that what makes the dollar worth anything is the US military. If you think the US military is going to collapse like Russia then you can think that the dollar is collapsing however given the sheer size and lethality of the military the dollar will remain stronger than most just due to the fact of in conflict you might hit the US once but the US will make you bleed for generations to come
If they got really desperate, they could do a bail-in for themselves and convert people's savings into treasuries.
The one certainty is that they will do something to prop up demand for US debt.
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Is that cheating though? Buying your own bonds, it will just bring the value of the US dollar down even faster.
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The US has been buying their bonds in one way or another for 100 years. While other countries use a central bank the US does it via the Fed and bond purchases
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Everything they do is cheating.
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They could cheat and manipulate a little less obviously.
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Why go through the effort, when no one seems to care anyway?
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How would they even enact it? Give each parent a debt of 1000$? That would hurt a lot, considering how much a baby costs!
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It isnt a debt! It is $1k set aside for the kid and they get it when they turn 18 it doesn't cost the parents anything!
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They dont just give out free money. There is no such thing as a free lunch.
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I mean read the leg... it is free money. What I commented earlier was that they could in theory instead of put it in savings accounts like the legislation talked about instead give the kid $1k in US bonds to offramp some of the vast bond holdings
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There are lots of options, but one that comes to mind is that they could make it a refundable tax credit. That would basically let people buy bonds instead of paying taxes.
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Would that actually work? I would buy the bond and sell them right away, because they are worthless. Waiting for them to mature is a losing proposition.
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If they used bonds you could not touch them. The kid could do whatever he wants once he/she hit 18 but not before.
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hhhmm... that would be a lot of money they would have to cash in. Imagine the first set, might bankrupt america lol
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Ehhh the US is issuing like 7 trillion in bonds this year alone so meh
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7 trillion is just a drop in the ocean. lol