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PARKERSBURG, W.Va. – The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.
It's time to start cashing them in.
For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.
Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.
Bars, restaurants and theatres may still be busy, and Europe may be bailing them out, but Greeks remain furious about their broken economy, clannish politics and corrupt society
GREEK PEOPLE are disillusioned, bitter and frightened by a financial meltdown that has taken their country to the brink of bankruptcy. As anger mounts, the country’s dynastic political class is under fire.
“People want justice, they want somebody to go to jail. The corruption is everywhere. Not only should the ordinary people have to pay, but also the big people. Otherwise we will not resolve our problems,” says Alex Opuolos, a business analyst in his 50s.
China retained its spot as the biggest foreign holder of U.S. Treasury debt in January although it trimmed its holdings for a third straight month. The string of declines are likely to underscore worries that the U.S. government could face much higher interest rates to finance soaring budget deficits.
The Treasury Department said Monday that China's holdings dipped by $5.8 billion to $889 billion in January compared to December. Japan, the second largest foreign holder of U.S. government debt, also trimmed its holdings but by a much smaller $300 million to $765.4 billion.
The United States and Britain are more likely than Germany and France to witness an embarrassing downgrade of their top debt rating, agency Moody's Investors Service said Monday.
For now though, Moody's said the triple A governments don't face an immediate threat to their top ratings as the servicing of the debt remains manageable — the top credit rating reduces the interest payments countries have to pay on their debt when going to the bond markets to raise capital.
However, debt affordability is "most stretched" in Britain and the U.S., Moody's said.
Mr Krugman seems entirely uninterested in the domestic political constraints facing China's leaders. He doesn't consider for a second the possibility that a bullying strategy on America's part might make China less likely to do what the administration wants. Why on earth would a nationalistic nation anxious to establish itself as great power want to come off to all observers as a weakling in the face of American bluster? Mr Krugman would paint China into a corner, forcing them to take steps detrimental to all involved.
The US rating agency said the US, the UK, Germany, France, and Spain are walking a tightrope as they try to bring public finances under control without nipping recovery in the bud. It warned of "substantial execution risk" in withdrawal of stimulus.
Otmar Issing, the ECB's former chief economist, told an Open Europe forum in London that policymakers are entering treacherous waters. "Nobody can be sure that we have a self-sustaining recovery. The challenges facing the ECB are tremendous," he said.
"Money multipliers have collapsed everywhere. What M3 is telling us is that confidence is missing. I don't see any way to stabilise M3 in such circumstances," he said.[...]Since January 2009, the M1 Money Multiplier has crashed further, to .786 in the U.S. as of February 24, 2010: [...] The multiplier's decline "corresponds so exactly to the expansion of the Fed's balance sheet," says Constance Hunter, economist at hedge-fund firm Galtere. "It hits at the core of the problem in a credit crisis. Until [the multiplier] expands, we can't get sustainable growth of credit, jobs, consumption, housing. When the multiplier starts to go back up toward 1.8, then we know the psychological logjam has begun to break."
California : Size of Budget Gap : 49.3% , Arizona : Size of Budget Gap : 41.1%
During the 2003-06 boom, the three agencies that supervise most U.S. banks -- the Federal Deposit Insurance Corp., the Office of Thrift Supervision and the Office of the Comptroller of the Currency -- gave out at least $19 million in bonuses, records show.
Nearly all that money was spent recognizing "superior" performance. The largest share, more than $8.4 million, went to financial examiners, those employees and managers who scrutinize internal bank documents and sound the first alarms. Analysts, auditors, economists and criminal investigators also got awards.
After the meltdown, the government's internal investigators surveyed the wreckage of nearly 200 failed banks and repeatedly found that those regulators had not done enough [...]