[dude1394]

Barry had better get his game one...another "opportunity" as in crisis is quickly coming.
http://fabiusmaximus.wordpress.com/2...01/solvency-2/

I'm thinking of going all-in on international investments, this country is starting to look screwed.

(1) Monthly cash flow of the US Social Security Administration
Month Cash in Outgo Surplus/Deficit YoY $ YoY %
Jan-09 $71,854 $55,290 $16,564 -$2,906 -15%
Feb-09 $54,413 $55,760 -$1,347 -$3,863 -154%
Mar-09 $58,669 $56,135 $2,534 -$4,935 -66%
Apr-09 $77,081 $56,596 $20,485 -$3,827 -16%
May-09 $54,408 $56,330 -$1,922 -$5,068 -161%
Jun-09 $61,156 $61,383 -$227 -$6,553 -104%
Jul-09 $56,345 $56,890 -$545 -$4,207 -115%
Aug-09 $50,657 $56,490 -$5,833 -$5,642 -2954%
Notes:

• In millions of dollars. Big money — aprox 5% of US GDP.
• YoY means Year-over-Year (e.g, August vs. August).
• This does not include the Medicare Trust Fund, for which I see only annual data. It contributions probably show the same trend.
• Quarterly contributions arrive in March, June, etc. April, of course, is a big month for contributions.
• Does not include “interest” paid by the government to itself, which is just another journal on the the government’s books.
• For more information see the source.

See the trend! The year-over-year change in the surplus was -$15.3B in the first four months of 2009, and -$21.5B in the second four months. Cash in was down 15%; cash out was up 3%. The latest forecasts were for the system to go cash-flow negative in 2016 (Medicare went into the red in 2004). August looks esp ugly, as Bruce Krasting warned us at his blog on 8 September 2009.


This does not mean that social security will go broke. Social security contributions are just taxes. Social security benefits are promises by the US government, and can be changed at will. Instead this marks an inflection point for the government’s solvency. For decades the taxes for Medicare and social security exceeded expenditures on those programs. The government spent this money.


This is the end of an era. As the boomers retire, expenditures for our social retirement programs begin their inexorable rise. Instead of funding the rest of the government, these programs become burdens. For the next few decades the government will find the deficit growing each year (all other things being equal). For more on this see “The biggest bailout yet“, Fortune, 17 August 2009). The coming wave of deficits are too large for any feasible tax increases to cover it. For more on the effects of various proposals, see these reports by the Chief Actuary.