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Obama To Raise 10-year Deficit To $9 Trillion

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Obama to raise 10-year deficit to $9 trillion

The Obama administration will raise its 10-year budget deficit projection to approximately $9 trillion from $7.108 trillion in a report next week, a senior administration official told Reuters on Friday.

The higher deficit figure, based on updated economic data, brings the White House budget office into line with outside estimates and gives further fuel to President Barack Obama's opponents, who say his spending plans are too expensive in light of budget shortfalls.

The White House took heat for sticking with its $7.108 trillion forecast earlier this year after the Congressional Budget Office forecast that deficits between 2010 and 2019 would total $9.1 trillion.

"The new forecasts are based on new data that reflect how severe the economic downturn was in the late fall of last year and the winter of this year," said the administration official, who is familiar with the budget mid-session review that is slated to be released next week.

"Our budget projections are now in line with the spring and summer projections that the Congressional Budget Office put out."

The White House budget office will also lower its deficit forecast for this fiscal year, which ends September 30, to $1.58 trillion from $1.84 trillion next week after removing $250 billion set aside for bank bailouts.

Record-breaking deficits have raised concerns about America's ability to finance its debt and whether the United States can maintain its top-tier AAA credit rating.

Politically, the deficit has been an albatross for Obama, a Democrat who is pushing forward with plans to overhaul the U.S. healthcare industry -- an initiative that could cost up to $1 trillion over 10 years -- and other promises, including reforming education and how the country handles energy.

DEFICIT WORRIES

Republicans have pounced on Obama for planning to spend too much when deficits are so high, and the issue is likely to loom large in next year's Congressional elections.

Obama, who has promised to halve the deficit by the end of his four-year term and likes to remind constituents he inherited a $1.3 trillion deficit from former President George W. Bush, says bringing down healthcare costs is critical to long-term deficit reduction.

Treasury markets have been worried all year about the mounting deficit. The United States relies on large foreign buyers such as China and Japan to cheaply finance its debt, and they may demand higher interest rates if they begin to doubt that the government can control its deficits.

"It's one of those underlying pieces of news that is liable to haunt the bond market at some point in the future," said Kim Rupert, managing director of global fixed income analysis at Action Economics LLC in San Francisco, referring to the revised 10-year deficit projection.

Many economists think it is unlikely the government can curtail spending, which means taxes would have to go up to cover the rising costs of providing retirement and healthcare benefits to aging Americans.

Higher taxes, which could slow economic growth, are also a major concern of voters on both sides of the political divide. Obama has promised not to raise taxes on Americans making less than $250,000 a year.

Just who is going to be buying T-bills and long bonds in ten years time?

This is complete madness.

I reckon that Mr Alex Jones is right and you will see the American state revoke the Posse Comitatus Act of 1878 in the near future.

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...that's what the new congress jet is for. It's an escape vehicle for those most to blame for collapse of empire America. They'll keep it going for as long as they can, but rest assured, they've got that bird fuelled and ready for takeoff...

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The hypothesis that debt is wealth is being tested.

So if they borrow at 5% that will mean a yearly service cost of $450bn!!!!

Every 1% interest charged for this money will mean $90bn in debt servicing.

Very sustainable in the long term!!!!

Growth is becoming even more important.

Prats.

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raising the debt ceiling used to be a major event.

seems to happen every couple of months.

something is toast, but its hard to see whats actually burning.

I suspect when it catches fire, things will happen very fast...like a bursting of a bubble?

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I can't help but think there is going to be an "Event" in Sept possable Oct............They default or the devalue the 4 to the ture of say 30% (It will be 50% down 3-6 months later)..............The "Swine Flu" is being kept ready to panic people into NOT coming out in MASS to protest.

Mike

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Debt is wealth.

Debt is wealth.

Debt is wealth.

Debt is wealth.

Got that?

you are a bankster and I claim my 5oz of silver.

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A recent global survey of the world’s garment industries by the US-based consulting house, the Jassin-O’Rourke Group, shows that a Bangladeshi garment worker gets only 22 US cents per hour.

To pay back $1,400 will take 6364 hours labour, or just over 2 years.

http://www.wnd.com/index.php?fa=PAGE.view&pageId=88851

As the Obama administration pushes through Congress its $800 billion deficit-spending economic stimulus plan, the American public is largely unaware that the true deficit of the federal government already is measured in trillions of dollars, and in fact its $65.5 trillion in total obligations exceeds the gross domestic product of the world.

It's just beyond discussing. I mean, what can you say?

:blink:

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I can't help but think there is going to be an "Event" in Sept possable Oct............They default or the devalue the 4 to the ture of say 30% (It will be 50% down 3-6 months later)..............The "Swine Flu" is being kept ready to panic people into NOT coming out in MASS to protest.

Mike

I would disagree, Bernanke in Fed speak said the near term prospects look good.

I don't expect anything bad to start happening until after Christmas, although Bernanke is probably hoping something doesn't implode somewhere else in the world.

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raising the debt ceiling used to be a major event.

seems to happen every couple of months.

something is toast, but its hard to see whats actually burning.

I suspect when it catches fire, things will happen very fast...like a bursting of a bubble?

I can tell you what it won't be, if that's any help ? ;)

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They don't even have to start selling do they? Not buying would be bad enough.

They'll shoot you for not buying? This is getting ridiculous.. I know lots of people without Treasuries. Or is it only other Governments that they attack?

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They'll shoot you for not buying? This is getting ridiculous.. I know lots of people without Treasuries. Or is it only other Governments that they attack?

Or they might start asking you to pay for protection.

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Come on. You know what I mean.

No, they will ensure that nobody steps out of line with their international ambitions.

So the bond markets still value USA Govt debt because they think they will be repaid from tax receipts either domestic or foreign? If this is what they think, in my view they are mistaken: The USA Govt doesn't have that much legitimacy. They can attack Iraq because they have an excuse. What is the justification to make the rest of the World pay USA taxes?

I don't like to labour the point but if you think fear of their military might is what sustains their debt, I disagree and see no reason why it can't collapse fairly soon.

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So the bond markets still value USA Govt debt because they think they will be repaid from tax receipts either domestic or foreign? If this is what they think, in my view they are mistaken: The USA Govt doesn't have that much legitimacy. They can attack Iraq because they have an excuse. What is the justification to make the rest of the World pay USA taxes?

I don't like to labour the point but if you think fear of their military might is what sustains their debt, I disagree and see no reason why it can't collapse fairly soon.

I know all the economists and acemdemics say one thing, and the politicians say another, but in reality it is much simpler than all that.

Hey, you or I call it 'paying' rent.

If you don't keep the yanks happy, well, you know. They don't spend 500 billion on their military for national security...

http://en.wikipedia.org/wiki/Nimitz_class_aircraft_carrier

And don't forget that a wounded animal is much more dangerous.

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I know all the economists and acemdemics say one thing, and the politicians say another, but in reality it is much simpler than all that.

Hey, you or I call it 'paying' rent.

If you don't keep the yanks happy, well, you know. They don't spend 500 billion on their military for national security...

http://en.wikipedia.org/wiki/Nimitz_class_aircraft_carrier

And don't forget that a wounded animal is much more dangerous.

But we've already got our own protection racket run out of Westminster. Are you saying there are going to be turf wars? Bitch can't have more than one pimp.

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