Quote of the Week – Alan Greenspan

“I believe that we should maintain the principles of Social Security, but I think the existing structure is not working. Until we construct a system that creates the savings that are required to build the REAL assets, so that the retirees have REAL goods and services. We don’t have a system that is working. We have one that basically moves cash around and we can guarantee cash benefits as far out and whatever size you like, but we cannot guarantee their purchasing power.”

– Alan Greenspan (2005)

Debt Disaster Seen Unless VAT Rises to 20% by 2020 (Sep 2013)

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Source: Bloomberg –Debt Disaster Seen Unless VAT Rises to 20% by 2020: Japan Credit

Notable excerpts:

Japan must raise its sales tax to at least 20 percent by the time the Olympics come to Tokyo in 2020 to avert a “disaster” in its bond market, according to the head of a panel advising the world’s biggest pension fund.

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Scandinavia’s Weakest Nation Finds Welfare Habits Too Costly (Aug 2013)

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Source: Bloomberg – Scandinavia’s Weakest Nation Finds Welfare Habits Too Costly

Notable excerpts:

Scandinavia’s weakest economy can no longer afford the kinds of entitlements its citizens were raised on, according to Danish Finance Minister Bjarne Corydon.

“We live in a world of global competition for jobs,” the 40-year-old minister said in an interview in Copenhagen. “For any finance minister wanting to be taken seriously, it’s something to deal with. That requires a modernization of the welfare state.”

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Increasing Bond Yields Risk Debt Spiral in U.S., Japan, BIS Says (Jun 2013)

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Source: Bloomberg – Increasing Bond Yields Risk Debt Spiral in U.S., Japan, BIS Says

Notable excerpts:

Major economies risk ballooning debt loads unless their growth can keep pace with increases in borrowing costs as spending on the elderly rises, according to the Bank for International Settlements.

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