Gary North's crystal ball is looking like one of those scary Hollywood disaster movies. Old folks, especially old folks on the verge of retirement, should take heed of his musings.The U.S. government has a nasty surprise for tens of millions of retirees: a now-empty piggy bank. Two of them, actually: Social Security and Medicare.
Congress will soon have a nasty surprise for voters: a larger deficit than announced to fill these now-empty piggy banks.
The Federal Reserve System will also have a nasty surprise for investors: newly created digital money to fill up the empty piggy banks when the Treasury cannot sell any more debt at low interest rates.
The free market will have a nasty surprise for everyone: rising prices in response to the Federal Reserve's digital money.
Medicare will have a nasty surprise for physicians who treat Medicare-funded patients: limits on payments per service that are set below urban costs (price controls).
Physicians will have a nasty surprise to patients: longer waiting periods (rationing by sitting in an office). The days of wine and roses are over. The era of nasty surprises has begun.
Social Security will go bankrupt in 2010.
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