The Pension Benefit Guaranty Corp (Federal agency that guarantees bankrupt pension funds) reported Friday that it ended it’s fiscal year with a $34 billion deficit, a 31% increase from the $26 billion deficit reported for the prior year.

QE to Infinity…AND BEYOND!!! will continue to grow exponentially as Social Security, Medicare, Medicaid, the Postal Service, FDIC, PBGC, and innumerable Federal spending programs are all bankrupt, and must either default or have their debts counterfeited away.
Which choice do you supposed Congress, the Treasury, and the Fed will choose?

WASHINGTON (AP) — The federal agency that insures pensions for more than 40 million Americans last year ran the widest deficit in its 38-year history.

The Pension Benefit Guaranty Corp. said Friday that its deficit grew to $34 billion for the budget year that ended Sept. 30. That compares with a $26 billion shortfall in the previous year.

Pension obligations grew by $12 billion to $119 billion last year. Assets used to cover those obligations increased by only $4 billion to $85 billion.

The agency has now run deficits for 10 straight years. The gap has grown wider in recent years because the weak economy has triggered more corporate bankruptcies and failed pension plans.
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  1. Hostess Union Pensions will rotate to PBGC.  On another note the USPS will lose $16 billion this year.  FHA is in the tank for $13 billion and expected to lose much more in the next two years.  Geithner will probably sign off on some $50 billion in Timmy Bonds that will be wrapped into the Fed Slush Fund bank (totally off budget ) to give FHA some ‘breathing room’.
      All these losses fall to the tax payers.
    Moral of the story.
    Profits inure to the private banking sector
    Losses become part of the tax payers burdens

    And is this was not enough, Argentina is slated to default very shortly.  That might come to $100 bllion.

    • Why do you think Obama and the dems want to drag private pensions into this mess, they need to cover their asses at the expense of the taxpayer yet again.

  2. I’ve posted this quote before, but it’s especially apropos to repeat on this thread …

    “Although historians do not advertise the fact, a lot of pension funds went bankrupt in the 1930’s, and the remaining ones had to scale back the amounts they had contracted to pay to their pensioners. Economists failed to offer an explanation for this universal phenomenon. Yet the explanation is clear: the accumulated capital of the pension funds was badly impaired, and in some cases completely wiped out, by the falling interest rate structure. Exactly the same causes are operating right now, (2010) and exactly the same effects will follow. The only difference is the larger scale of capital destruction in the present episode.” –Antal Fekete

      

    • Spot on Pat   Christina took a total of $30 billion in private pension funds recently and the government will still default on about $100 billion or so (number is not exact)   Pensions are being hammered with ZIRP, fund manager ineptitude and a cyclically poor performance in the stock market, land, developed real estate, UST and other bonds, bank stocks to name a few of the malinvestments of the pension plans.  CalPers hornswoggled  Cal government to force a 3% pension ‘contribution’ from private employers with 5 ore more people.  Taken from the employees salaries as if they worked for the state government, these funds from private enterprises and employees is being used to refill the depleted coffers of the largest and worst run government pension plan on the planet, of course right after the last worst pension plan, probably in Illinois.
      These extraction plans are being fully implemented as we speak.
      I guess the collectivists and Il Duce finally found  a way to force the citizenry to disgorge their remaining wealth in a paroxym of redistribution using the only large deposit of funds in the US.  It’s kind of like a silver miner trying to make their poor ore grade mine a winner.  Ain’t gonna happen.  Pensions can go bust as you clearly stated   The government pension plans deserve their final resting place.
      My concern is they will hit this place after they stripmine every private plan in the land. Not ours, of course, since we have taken measures to protect our plans.

  3. There is no better reason for people, make that sheeple, to start buying physical silver by the bag full.  Lets face it, how many people can have their 401K, IRA, social security, and their goverment pensions taken over by Obama and survive?  Not many at all.  Appears his goal is to have all of us on the dole to keep us “imprisioned” by our lack of HARD assets.  Well, he ain’t got us “stackers!’

    • Plus, the fiat system will collapse soon so all savings by 401K, IRA, social security, pensions and more will become totally worthless especially if they are kept in digital form. If at least those savings are kept in cashes, you could use them to create a fire to heat up yourself and cook.

  4. Yep   The real pisser is that the Social Security trust fund (aka the world’s largest supply of post it notes) has been ZIRP’d.  The rate paid on the UST Bonds (WAS) about 5.6%  With Operation Twist and the super low rates offered by these benchmark bonds, the rate is now is about 1.6% or so.  This means that the negative cash flow resulting from claims against the fund by retirees  at $90 billion a year coupled with a reduction of $50 billion in expected income due to the effects of ZIRP will result in a serious deficit year over year.  The trust fund could, and I won’t say will, but could be depleted by 2022.   To be true this is slower a rate of depletion than Medicare,  which was scavenged to the tune of $760 billion to seed capitalize Obamacare.
    Since Social Security was Federalized back in LBJ’s day, that money is being vaporized.  Medicare is being looted as we speak and the SS fund is seeing inflation gut its core. 2 years without inflation adjustments (2011 and 2012) we see 2013 with a robust 1.7%, the averare recipient will see another $18 a month.
    As I recall Medicare and Social security were focibly extracted from our pockets.  Our IRA and 401k targets are also our money. Let’s add this up

    Private retirement accounts (401k and IRA)            $6,000,000,000,000
    Social Security trust fund*                                       2,700,000,000,000
    Medicare**                                                              760,000,000,000

    Total                                                                  $9,460,000,000,000
    Sofa change***                                                       540,000,000,000

    Grand total                                                       $10,000,000,000,000 

    * when the depletion of Social Security gets close to depletion with its mandated reduction in benefits, the payments will be serious income and NET WORTH tested.  Hide your stack.  That’s part of your net worth
    **  Medicare will self cure with death panels, lack of doctors and means testing, like Canada and Great Britain
    *** PBGC and other public pension bailouts will find their way into our retirement plans life CA and its 3% tax surcharge

    Social justice and redistribution of wealth is well under way.   Don;t worry, the gummint will look out for you

    The more I think about it more I think of the Jews who fled Nasty Germany with their gold sewed in their clothes. Barbarous relic—riiiiight

    Protection from the Barbarians is more like it

    • As someone on SSDI and medicare I worry what the future may bring. I am stacking as much as I can afford but on my income it isn’t a lot each month.

  5. Today’s pensions are a waste of purchasing power because they could get affected by inflation in the future. Pensions will also put you into financial troubles so it is good that you get rid of them as fast as possible or at least exchange them all for physical gold and silver.

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