US Debt ceiling and G Fund

[clester]

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The government is borowing from ou G fund because its reached the debt ceiling. Does this bother anyone else?

http://www.govexec.com/dailyfed/1004/101404cdpm1.htm

 

[CJ]

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Hmmmm, We didn't have this problemwhen the government was responsible enough to balance the budget.

Makes me wanna vote D.

 

[tsptalk]

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clester wrote:

The government is borowing from ou G fund because its reached the debt ceiling. Does this bother anyone else?

It bothers me.:shock: Should we believe this?...

"The action is temporary and will not affect G Fund beneficiaries because, by law, Treasury must make up the lost investments when the debt crisis is over."

 

[FundSurfer]

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It has happened several times before. The government routinely raids social security surplus as well. I don't worry much about the G-fund. I will be concerned if they raid other funds. The TSP investment in the markets affects prices. Investment in G-fund doesn't.

 

[Dakota]

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The government just bothers me. Two big oil barons in the whitehouse and sudden takeover of Iraq. I guess if Kerry gets in Ketchup will be to high for mcdonalds

 

[Mike]

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We didn't do very well under all-Democratic leadership in 1993-1994. The money was made under divided gov't.

I didn't realize they had legal authority to borrow from a fund that consists of pre-tax dollars. At least when they borrow from social security, that's already been taxed (so although irritating, it is somewhat expected).

Dakota, Iraq isn't about a US takeover of their oil supplies. If securing other countries' oil was our real goal, we would've invaded a lot of other oil producers before Iraq.

 

[cowboy]

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LoL!I can just see everyone going to McDonalds and paying extra for Ketchup like we do for sour cream at Taco Johns.

Comment to Mike I quess looking at the big picture the government knows how much money is coming back to the government in the G fund and will use these funds as they are tax free until drawn out. So when u retire they pay you and take theirs its just a given. So basically to the government this is free money in my opinion. Yes it is scary but any investment is, another scary part is the government can change the rules too.

Heressomething scaryfor you, looking at government and what it is doing at the current time. One of the big pushes is insurance all of the politicians claim we need insurance to me insurance is the death to democracy because it is a special interest group that will break you and the government. I believe they claim democracies die because of special interest groups. Currently insurance and government are bed partners and I know a lot of people living without it just fine. Your insurance has been going up every year because they know they have people going to buy it especially when you have a government that says you have to. How much has your car insurance went up, government ties disaster payments to insurance and forces farmers to buy insurance the next 2 years after,now the big push for mandatory health insurance. Insurance is basically a bet that something will happen or not otherwise your not getting anything but paying for others who do have something happen. Just a thought people, but maybe we should start to cut special interest groups out of the government instead of feed them year after year. What are your thoughts on this? Insurance prays on your fears just like the flu shotshortage at the moment!

 

[Dakota]

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Mike, I appreciate your input and I should probably keep some of my thoughts to myself. I do agree with homeland security, but i believe there was more to Iraq than just that.

Back to the board, could you tell me if S fund looks good or do you believe we should spread it out overr the board a little?

 

[Mike]

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I think the I-fund is too high and will drop. Most of its strength this year has been due to the very weak US dollar. If/when this situation changes, it'll hurt the I fund (as interest rates rise, the dollar should strengthen). However, if the dollar doesn't rebound, I'm sure the I fund will continue to climb - in which case, the only way you can make money off it is to buy the pullbacks and sell after a few up days (which is pretty much what I just did, buying some shares at the end of september and selling after the fund went up into the $13.60-13.70 range).

Both the C and S are about $0.40 off their highs earlier this month. On that basis, I'd say it's a good time to buy them. The C fund is at a critical point right now, though. It hasn't been below $11.70 since the end of August (it last hit $11.70 on the 27th of September but bounced off that). S fund has been more volatile, and it's tougher to spot a critical price level for that fund (looks like $12.73 is its low for the past month or so).

 

[TheProphet]

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Mike,

You are right the S Fund is the best value now...

I seems to me to high and they will not be given away free Dollars in Europe streets... :^

Leon