Apres Baby Boomers, le deluge

Nobody listens to me but here’s the comptroller general of the United States (I had no idea there was such a position). From USA Today: “A fiscal hurricane on the horizon”

"We face a demographic tsunami" that "will never recede," David Walker tells a group of reporters. He runs through a long list of fiscal challenges, led by the imminent retirement of the baby boomers, whose promised Medicare and Social Security benefits will swamp the federal budget in coming decades.

Sadly, it's no laughing matter. To hear Walker, the nation's top auditor, tell it, the United States can be likened to Rome before the fall of the empire. Its financial condition is "worse than advertised," he says. It has a "broken business model." It faces deficits in its budget, its balance of payments, its savings — and its leadership.

It’s a sad commentary that nobody holds out much hope that the leaders in Washington will take the necessary steps to keep the country solvent (see the article). The likely scenario I see is that U.S. Treasury Bonds slip from their vaunted position as the safest investment in the world and domestic and foreign bankers impose some sanity on runaway entitlement spending.