Monday, March 2, 2009

Federal Deficit to go from 0.45 trillion in 2007 to 2.5 trillion in 2009

Obama Says Short U.S. Treasuries

Bank bailouts, homeowner bailouts, auto industry bailouts, and now massive stimulus packages; the Federal Government spending list goes on and on. The Federal Deficit for this fiscal year is projected by Goldman Sachs to be as high as $2.5 trillion. That's 5.5 times the fiscal 2007 Federal Deficit and 1.5 times Gross U.S. Savings. A $2.5 trillion deficit will create quite a waterfall on this graph, don't you think

Posted by sold 2 rent 1 @ 02:29 PM (932 views)
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6 thoughts on “Federal Deficit to go from 0.45 trillion in 2007 to 2.5 trillion in 2009

  • mark wadsworth says:

    Yup. Yield on benchmark 30 Year US treasury up from 2% to 3% since all time low at beginning of year, which equates to a 15 per cent fall in the capital value.

    http://www.fixedincomeinvestor.co.uk/x/bondchart.html?groupid=8&id=170&stash=B9E00E8

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  • sold 2 rent 1 says:

    QUOTE
    “You say: deflation is the concern now. There’s no reason for any inflation premium. That’s tomorrow’s worry. U.S. Treasuries are the safest asset in the world! Investors, foreign and U.S. both, would not be piling into U.S Treasuries if they were worried about inflation. And you would be right. No one is worried about inflation. Everyone is worried about safety. And that’s precisely the point. I say safety from what. If you are a contrarian, that should tell you something. Do I hear crowded trade? ”

    The deflation view is going into exhaustion. The Armstrong turning point on 19 April is where deflation turns to inflation.

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  • sold 2 rent 1 says:

    QUOTE
    “My thinking, Short U.S. Treasuries. Maybe a bit early, especially if we have another deflation scare, but if you are not already in, at these historically low rates, scaling in here and now may not be such a bad idea. ”

    IMHO we have one more deflation scare left in the bag that should take us into exhaustion in April.
    This will be a fantastic time to load up on oil, gold, and especially silver. (physical, and stocks)

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  • sold 2 rent 1 says:

    mark wadsworth,

    What is the difference between your graph and mine? Mine is still showing a down trend. How come?

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  • mark wadsworth says:

    S2R, the chart to which I linked is just the last six months, the uptick over the past two months is barely visible on yours.

    That site also does a ten year chart for US ten year treasuries, see here which looks like the last ten years of yours, only the yield dipped to 2% at the turn of this year.

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  • sold 2 rent 1 says:

    MW,

    It will be interesting to see if the yield line has already bottomed or if we have one more capitulation ahead as I think will happen in April on the Armstrong turning point.

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