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Thread: Greenspan: U.S. is Signficantly Understating National Debt; S.S. Trust Fund Does Not Exist

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    Greenspan: U.S. is Signficantly Understating National Debt; S.S. Trust Fund Does Not Exist

    Alan is so candid in his later years now that's he's freed from his former 'obligations.' heh

    http://pjmedia.com/blog/greenspan-u-...national-debt/



    Alan Greenspan, former chairman of the Federal Reserve, said a Social Security Trust Fund does not exist and that the U.S. is “way underestimating” the size of its national debt.

    “The notion that we have a trust fund is nonsense – that trust fund has no meaning whatsoever except for the fact as an all private fund to benefit programs, if it runs out of money, you can only pay out in cash flows that come in but the probability that will happen is not particularly high,” Greenspan told the Fiscal Summit held by the Peter G. Peterson Foundation.


    “That means the trust fund is a meaningless instrument that has no function … it’s exactly the same thing as current expenses.”
    Lawrence Lindsey, former assistant to the president on economic policy in the Bush administration, said the national debt is closer to 300 percent of GDP with unfunded obligations for Social Security and Medicare included.

    “That, by the way, is higher than Greece’s debt currently,” he said.

    Greenspan said the White House and Congress are avoiding the fact that the government has committed itself to paying for pensions the nation cannot afford.

    “It’s not that we’re getting like Greece. We’re getting like Illinois,” he said.

    Richard W. Fisher, president/CEO of the Federal Reserve Bank of Dallas, called the fiscal crisis a “political train wreck ready to happen.”

    “We have to somehow urgently come to grips with it,” he said.

    Greenspan said the U.S. is “way underestimating” the national debt, which is currently at $18 trillion.

    “Largely because we are not including what I would call contingent liabilities, that is the issue of, which is answered by a question: what is the probability that in today’s environment JP Morgan would be allowed to default? The answer is zero or less,” he said.

    “Now, that means that whole balance sheet is a contingent liability. Now to be sure, while it’s contingent, there’s no interest payments but ultimately that overhangs the structure because we have committed in so many different ways to guarantee this, that and the other thing. It’s not only Fannie and Freddie but it’s a whole series of financial institutions and, regrettably, it is also non-financial institutions.”
    Last edited by AuH20; 06-09-2015 at 09:55 AM.



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  3. #2
    Ya think? What was your first clue, Sherlock?

    DUH!

  4. #3
    Greenspan said the U.S. is “way underestimating” the national debt, which is currently at $18 trillion.

    “Largely because we are not including what I would call contingent liabilities, that is the issue of, which is answered by a question: what is the probability that in today’s environment JP Morgan would be allowed to default? The answer is zero or less,” he said.

    “Now, that means that whole balance sheet is a contingent liability. Now to be sure, while it’s contingent, there’s no interest payments but ultimately that overhangs the structure because we have committed in so many different ways to guarantee this, that and the other thing. It’s not only Fannie and Freddie but it’s a whole series of financial institutions and, regrettably, it is also non-financial institutions.”
    Greenspan has not given his estimate, but he seems to be in agreement with an earlier article where a study concluded that the "debt" is much higher than officially acknowledged.

    Study: True size of federal government debt is $210 trillion
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  5. #4
    $20 trillion or $200 trillion - it will not be paid. The remaining questions are will there be a direct default or inflation, when will it happen, and what happens after that?
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  6. #5
    Quote Originally Posted by Acala View Post
    $20 trillion or $200 trillion - it will not be paid. The remaining questions are will there be a direct default or inflation, when will it happen, and what happens after that?
    The longer the can gets kicked the thinner and less stable it becomes.....

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    Quote Originally Posted by Brian4Liberty View Post
    Greenspan has not given his estimate, but he seems to be in agreement with an earlier article where a study concluded that the "debt" is much higher than officially acknowledged.

    Study: True size of federal government debt is $210 trillion
    Greenspan is a conspiracy theorist now, making such ludicrous claims.



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