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Us Govt Expects To Borrow $1.5Tr This Year 9.8 Of Gdp

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http://cbo.gov/doc.cfm?index=12039

For the federal government, the sharply lower revenues and elevated spending deriving from the financial turmoil and severe drop in economic activity—combined with the costs of various policies implemented in response to those conditions and an imbalance between revenues and spending that predated the recession—have caused budget deficits to surge in the past two years. The deficits of $1.4 trillion in 2009 and $1.3 trillion in 2010 are, when measured as a share of gross domestic product (GDP), the largest since 1945—representing 10.0 percent and 8.9 percent of the nation's output, respectively.

For 2011, the Congressional Budget Office (CBO) projects that if current laws remain unchanged, the federal budget will show a deficit of close to $1.5 trillion, or 9.8 percent of GDP. The deficits in CBO's baseline projections drop markedly over the next few years as a share of output and average 3.1 percent of GDP from 2014 to 2021. Those projections, however, are based on the assumption that tax and spending policies unfold as specified in current law. Consequently, they understate the budget deficits that would occur if many policies currently in place were continued, rather than allowed to expire as scheduled under current law.

So that's:

$1.4tr - 2009

$1.3tr - 2010

$1.5tr - 2011

So in 3 years the US govt will have borrowed $4.2tr!!!!

They are just going to keep printing.

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http://market-ticker.org/akcs-www?post=178314

But But But Deficits Were Coming Down!

Uh huh......

For the federal government, the sharply lower revenues and elevated spending deriving from the financial turmoil and severe drop in economic activity—combined with the costs of various policies implemented in response to those conditions and an imbalance between revenues and spending that predated the recession—have caused budget deficits to surge in the past two years. The deficits of $1.4 trillion in 2009 and $1.3 trillion in 2010 are, when measured as a share of gross domestic product (GDP), the largest since 1945—representing 10.0 percent and 8.9 percent of the nation's output, respectively.

Uh, no. First, calendar years guys. Second, here's the chart:

There's the real numbers, from Treasury itself. Those are not estimates, they're actual daily figures.

For 2011, the Congressional Budget Office (CBO) projects that if current laws remain unchanged, the federal budget will show a deficit of close to $1.5 trillion, or 9.8 percent of GDP.

That's $500 billion more than previously estimated. I wrote about it at the time, since when the FICA tax reductions were passed the "contribution" to the deficit (which was easily calculable at about $450 billion, all in) were trivially able to be figured. This of course meant that the alleged $1 trillion would not be $1 trillion, but rather would be $1.5 trillion, and that's if you believe the CBO's alleged "Deficit" numbers, which are bogus - as they account for cost-shifts and off-balance-sheet games.

In point of fact you have to look at the actual numbers "as borrowed"; when you do this you wind up with $1.7 trillion for calendar year 2010, and this means we're rather likely to post a $2 trillion number for calendar year 2011.

That is, if we get away with it, and I don't believe we will. From the Annual Ticker:

We're not going to get away with spending another $450 billion in deficits on top of the $1.6 trillion we blew last year. $2 trillion in deficits? Not a prayer.

The CBO now agrees with me on the size of the deficit. They were late, but better late than never.

The deficits in CBO's baseline projections drop markedly over the next few years as a share of output and average 3.1 percent of GDP from 2014 to 2021. Those projections, however, are based on the assumption that tax and spending policies unfold as specified in current law. Consequently, they understate the budget deficits that would occur if many policies currently in place were continued, rather than allowed to expire as scheduled under current law.

There will be no "expiration" as that term assumes we will get to 2014-2021 before this entire fraudpile blows up in our faces.

That's not going to happen, and the orgasmic reaction you're seeing in the market to the supposed "liquidity-driven rally" is amusing. Let's face reality here folks - liquidity is debt, not growth.

Debt has to be paid back - or defaulted.

Guess which one we'll be doing?

Dennigers take on this.

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For a moment there i thought you said the UK.

But yes printy printy, which will encourage more and more nations to abandon the US$, Russia and India + Iran are so far. Just China (partial) to go and then oil. Then US$ is dead meat.

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i've still got that nagging that they can 'borrow' infinitum in a fiat environment and that we here are the fools.

why do you need paying back on your bonds/investments when a government can just printy?

the hope lies in the proles, but their disposable anyway. :unsure:

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i've still got that nagging that they can 'borrow' infinitum in a fiat environment and that we here are the fools.

why do you need paying back on your bonds/investments when a government can just printy?

the hope lies in the proles, but their disposable anyway. :unsure:

The hope lies in China actually, Russia and Japan...

If they completely lose the faith in the $ the US game is over. The amount of construction in China is phenominal, they are getting rid of their $ soon as possible and doing this via improving their infrastructure and buying stuff all over Africa and Siberia to get rid of their $.

The US reckons it can nuke China economically by printing or defaulting.

But they are scared that China has dumped so many $ that when they do this China will do a show hand and be holding very few $. USA goes hyperinflation, China invades Taiwan. The USN can't afford to move the 7th fleet out of Yokohama.

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http://cbo.gov/doc.cfm?index=12039

So that's:

$1.4tr - 2009

$1.3tr - 2010

$1.5tr - 2011

So in 3 years the US govt will have borrowed $4.2tr!!!!

They are just going to keep printing.

Yep pretty much, as long as the yuan is pegged to the dollar and commodities are priced in $ they can print what they like. China and many other economies rely on demand from the US as well.

They also have the highest military by some distance.

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We're not, the simple fact is that the UK public are in for a shock drop to their standard of living but when it catches up other countries like the US we will have been through the pain first as Mervyn mentioned last night.

If you look at this story http://www.reuters.com/article/idUSLDE70P26G20110126 the UK banks are going to be the safest banks in the world, lets also not forget the top 10 UK banks hold 1.5 times more assets than the top10 US banks. Its irrelevant to a point that all the assets are not true market value, everyone is doing the same on that score.

Now by the UK economy contracting this year, that will ripple out to the rest of the world because of Globalism, so in effect we are making the tide go out and we will see in time some countries lose their advantage in the world which in turn will usher in a better form of society. Likewise as other countries banks wobble as their economy becomes worse for them, the liquid individuals will move the money out of the country to safer banks which will be UK banks, I'm unsure on Switzerland it depends on how quickly they move.

But lets face it most people were happier with wife at home looking after the kids, and homes being affordable on one wage packet and more spare time to spend with family and friends. I think you will see a return to those times, which I believe is good for society in the not too distant future as crime will reduce and so will alot of todays modern day stresses, the only thing that will change is there will be less consumerism purchasing tat, people will think twice about buying some things which is also good for the environment.

Thats one possible scenerio I see and also the most likely. One other point I will make is that those british businesses looking to expand would do well to take on immigrants simply becuase they can be used to work in their home country to start the expansion of the british businesses abroad.

I hope you are right, but the pain could last a lot longer than a few years.

There are too many variables to predict any outcome, things could quite easily spiral out of control. Although I do love the irony that according to Darling the entire banking system was 2hrs from total collapse now we have the safest banks in the world, what a turn around.

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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