Social Security insolvency is now one year closer
The 2016 Social Security Trustees report showed a continuation of the current trend toward insolvency of both of its trust funds. The Trustees estimate that Social Security's combined retirement and disability trust funds will become exhausted in 2034, the same as reported last year. Regrettably, the lack of change in the combined trust funds' insolvency dates has lulled some into a false sense that the program's finances are now stable. Please don't be fooled.
While the trust funds depletion date is unchanged, this simply means that Social Security's day of financial reckoning is now one year closer — and less than 20 years away. Social Security faces severe, urgent financial challenges that policymakers must soon address if we are to ensure the program remains viable for the most vulnerable in our society.
In fact, the Social Security crisis is not only real; it is already upon us. The trustees now estimate that the 75-year financial shortfall for the combined trust funds is $11.4 trillion in present-value terms. If we indefinitely extend past the 75-year period, the so-called "infinite horizon," the shortfall is a whopping $32.1 trillion. For comparison, our nation's gross domestic product is slightly over $18 trillion – and our gross national debt (not including unfunded liabilities) at the end of June is$19.3 trillion.
In April, the EU laid down new regulations for the collection, storage, and use of personal data, including online data. Ten years in the making and set to take affect in 2018, the General Data Protection Regulation guards the data of EU citizens even when collected by companies based in other parts of the world. It codifies the “right to be forgotten”, which lets citizens request that certain links not appear when their name is typed into Internet search engines. And it gives EU authorities the power to fine companies an enormous 20 million euro—or four percent of their global revenue—if they infringe.
Global prospects for growth remain sluggish at best, in spite of reduced expectations for Fed fiscal tightening and a moderate recovery in oil prices. One can expect growth to continue to be hindered by economic uncertainties in the US, questionable central bank policies, and the Chinese slowdown. And on top of it all, political risks also still abound.
After the June jobs data was released, the Dow Jones Industrial Average jumped 100 points and left investors with hopes of a stronger economy in the second half of the year.
But that’s not likely the case.
In World Of $50 Oil, Shale Beats Deepwater
U.S. shale is the lowest cost option for new oil production and is likely to be more competitive than conventional offshore drilling, according to a new report from Wood Mackenzie. The U.S. shale industry has weathered the oil price downturn, tweaking drilling practices and cutting costs in order to stay in business. A new report from Wood Mackenzie finds that the industry is proving to be resilient and flexible in the face of the worst oil market crisis in three decades. The report concludes that U.S. shale companies have managed to cut costs by as much as 40 percent since 2014. Much of that comes from lower costs from equipment suppliers and oilfield services firms. But it also comes from improved productivity from the average shale well. Instead of drilling anywhere and everywhere, U.S. shale companies are getting better at finding the “sweet spots.” Intriguingly, the […]
