The Funds were required to only invest in U.S. Treasury bonds. Because they’re “safe” don’t you know.
Yeah, it was kinda convenient, wasn't it. :-(
But seriously: can you imagine what would have happened if the SSA had invested it in anything else, like corporate bonds (as you suggested later)? You know that Congress would have never left the matter to competent investment advisors. They would have put all kinds of pre-conditions on what were acceptable investments, and would probably have been mandating certain investments, like:
Solyendra
General Motors
Chrysler
I could go on, but I think you get my point. Imagine the current "crony capitalism" of this administration, multiplied by thousands.
An aside: you probably know that the Obama administration voided a century of precedent in bankruptcy law by bypassing the secured bondholders that loaned money to Chrysler and GM, and gave company assets to the UAW.
Do you know who got burned? Yes, there were some "fat cat" investors, but there were also a lot of individual investors that had bought what they thought were safe investments for their IRAs. But, who really got shafted: public pension plans for teachers, police, firefighters, etc. Now, those pensioners will either get smaller cost of living adjustments in the future, or the state/local taxpayers will have to make up the shortages.
But, I digress. Back to your posting:
I believe over half of the bonds are “special” and redeemable ONLY by the U.S. Treasury.
I think you are referring to the "trust fund". It's all of them. According to ssa.gov, they held 2.6 trillion in "special issue" bonds at the end of 2010, and none in marketable securities.
BTW, the bonds are printed on "real" paper, and stored in a file cabinet in Parkersburg, WV.
All of this loving by freepers for Socialist Security. Maybe I shouldn’t be shocked. That was FD Roosevelt’s idea. Get people hooked on a government program and they’ll oppose any cuts in the taxes to fund it.
I suppose it will be the same with Obamacare in 10 or 15 years. There will be “conservatives” saying we can’t cut Obamacare taxes or it would undermine the system’s finances!