It’s Not 2008, But People Worry About Savings and Investments

To answer a couple of readers’ questions: No, your Thrift Savings Plan accounts are not insured. Neither by the Federal Deposit Insurance Corporation nor anyone else. Maybe the G Fund. It consists of U.S. Treasury bonds, so they’re backed by the faith and credit of the government.

TSP plan holders surely know the importance of that faith-and-credit fact given that at this moment, Treasury is vacuuming those G-Funds balances into the extraordinary measures, by which the government is paying its bills. Borrowing from debt until it gets authority from Congress is issue new debt.

Therefore, the questions about TSP insurance suggest a certain level of anxiety about savings and investments. There’s also the ongoing question of future Social Security Old Age, Survivors and Disability Insurance funds’ solvency. The latest bank fiasco only compounds the anxiety. In the back of many minds lies the question, can the government stay on this course forever? I only quote the Government Accountability Office, which regularly states that the fiscal course is unsustainable.

The Silicon Valley Bank deal is nowhere near the size of the 2008-2009 financial crisis and its oceanic flood of toxic assets. Yet it’s also wrapped up in politics, moving rules, and bets on gyrating fiscal and monetary policy. At the least, maybe regular people in and out of government will stop citing “silicon valley” as some sort of lofty ideal. Between Theranos and the Silicon Valley Bank story, the Valley seems as much about hucksterism, inbreeding, self-dealing and working the political connections as about innovation. Why, just yesterday, one former Theranos executive reported for duty — to the Terminal Island Federal Correctional Institution at San Pedro, California. How did that lyric go? He “caught the last train for the Coast…” Click HERE to read more.