Yep, I bet that shocks alot of federal employees that they could go and grab that. I’ll bet unions get dragged into changing the future of the fund after this mess and remove it from federal hands.
The other question will be if they can grab the TSP (the 401k fund of gov’t employees). That will really screw up stocks and investments across the nation if they removed money from that.
What will they do if Congress refuses to raise the debt ceiling?
Sounds like there is some impact on the TSP G fund. It reads like the TSP will take deposits, but not issue securities. So where does the money go...
A Message from the TSP’s Executive Director
As we await legislation on raising the Federal debt limit, I would like to address your concerns about the possible suspension of issued securities to the Government Securities Investment (G) Fund. In the event that the U.S. Government reaches the statutory Federal debt limit, the Federal Government may temporarily be unable to issue new securities to the G Fund because to do so would exceed the present debt limit. However, G Fund investors are always fully protected and G Fund earnings are fully guaranteed by the Federal Government due to statutory protections in the Thrift Savings Plan Investment Act of 1987. This protection, known as the make-whole provision, will work to ensure that G Fund investors are completely unaffected by the limitation on securities issued by the U.S. Treasury. G Fund account balances will continue to accrue earnings and be updated each business day, and loans and withdrawals will be unaffected.
The Government Accountability Office has published a report which explains the full protection provided to G Fund investors when the U.S. Government reaches the statutory Federal debt limit. The report can be found here: http://www.gao.gov/products/GAO-12-701
If you have any additional questions, please call the toll-free ThriftLine at 1-877-968-3778 and speak to a Participant Service Representative.
Greg T. Long
© 2012 Thrift Savings Plan
I bet that shocks alot of federal employees
They voted for Obama. Haha. The joke’s on them.