QUICK, ask Yellen what to do. She will explain that the charts are not the be trusted because only she has accurate economic information and our country has never been better.
I feel so much better. Now to go out and buy a $70k truck, $700k house and barrow $2mil to invest in the markets. What can possibly go wrong?
If you didn’t read The Fourth Turning then stop.
This is what is predicted. The Democrat – Republican paradigm has been broken. Maybe Trump is good/bad but he has completed the mission. People have stopped looking along party lines and party leanings (I am excluding the lemmings). So, Donald Trump is a good thing.
Problem is that his election signals bad things. He’s not causing dick to happen, but like being a life long smoker who dies of a cold, he’s going to get the blame. I don’t see him that way but I marvel at people who think that he would be the one to save jack shit. Jack shit left the building in 2008, we are fucking over the cliff. But God bless Donny, he’s taken on trying to fly.
With eyes being opened and the world in the shitter this is the time we look for true leadership. Not Trump’s fault but we are heading for rough seas.
Now you know why USA is pushing for war.
They need another Marshall plan in the world and an excuse to wipe out countries they owe money to so they can write it off.
Does anything discussed in this article surprise me? NO.
America’s Financial Accomplishments for the last 8 years under OBAMA.
Most Americans have never seen a Trillion Dollars visually. So let’s review the financial accomplishments of America under the current DEMOCRATIC executive leadership that the TRUMP administration has inherited!!!
1.) Student Loan Debt – 1.3 Trillion
2.) America’s debt – UP over 100% in 8 years,
3.) America’s unfunded liabilities – 150 Trillion plus and climbing rapidly
4.) Corporate Debt – Up over 100% in 8 years.
5.) Bank Derivative Exposure – Up over 300% in 8 years.
6.) Amercian Consumer Debt Broke New Records
7.) America’s foreign policy – America now pays ransom to terrorist states like Iran (1,700,000,000)
8.) State and Municiple Pension Shortfall – 6 Trillion plus
9.) Fed Balance Sheet – At 4.5 Trillion – Up Over 400% in 8 years
10.) US Government Cannot Account for 6.5 Trillion in its books.
Even though Trump has taken credit for every bit of good financial news since he was elected, I don’t blame him for the numbers outlined in this article. It was baked in the cake before he even announced his candidacy.
What I do blame Trump for is seemingly back peddling or outright pulling a 180 on virtually everything he said he was going to do to fix it.
So here’s the percentile breakdown of those numbers…
- Defense: $58 billion = 14.7%
- Social Security: 79 billion = 20.1%
- Medicare: $75 billion = 19.1%
- Interest on debt: $30 billion = 7.6%
- Other: $151 billion = 38.4%
(adds up to 99.9% due to rounding but you get the idea)
first of all, wtf is “Other”… it’s not the social security or medicare third rail so what’s in there that’s so special it can’t be touched…
second, 7 to 8% going to interest on debt seems low until you realize how low interest rates are… if rates go up, pop goes the weasel in that category, which is why Trump is all for low interest rates… I mean, what sitting President wouldn’t be facing this situation…
last, 14.7% for defense may seem like a lot but we’ve already had this discussion re: is this reasonable spend or not… I hate to say it but, historically, it actually is…
so, we have 39.2% of entitlements and 38.4% of “Other” that’s slushing around to who knows where from one day to the next… looks to me like “Other” has a big fat target on its back if you’re looking for low hanging fruit to cut… then again, this is ZH where super complex problems get overly simplified so who knows…
Maybe just about everyone who pays taxes is waiting till the last minute like me, working overtime to find every deduction I can to starve the beast.
Sadly I can’t get every cent back
AIN’T NO DIMES FO DINDUS!!!
Nobody asks where I want the tens of thousands taken from me to go. Because I don’t get to choose means they don’t deserve it.
I’m pissed enough that I have to pay $1 more a day for my kids lunch to pay for the ones that get lunches for free. Seeing most of my tax money pay for Ghetto trash and Tomahawk missiles boils my blood.
I hate to break it to you, but you’re starving one beast to feed another…
don’t know if anyone’s noticed lately, but we’re right smack dab in the middle of a housing bubble again… what does that mean… it means people are writing off way more than they did previously in the form of mortgage interest and property taxes (which, btw, have been _going through the roof_ just about anywhere you look)…
so, the feds don’t get money because that money already went to state / county / municipal which in turn was written off… damned if you do, damned if you don’t…
I’m beginning to think it’s better for the average American [like me] to quit and join the FSA and get free housing, free food, free health care, free cell phones, free purple escalade, and a free extra wide Walmart scooter.
No. Real EPS on a GAAP basis are down for three years straight (And without buybacks would be down even more) for one simple reason: nobody has any money!! Don’t look at the garbage Wall Street feeds you with, GAAP (As Reported) data is all that matters.
I’ve also been Galty for years. If things ever improve I doubt that I will ever return to the way I lived prior to my conversion. I used to talk with my grand parents about what it was like raising 5 children during the depression–they never regained their trust in government.
I doubt that I will either–I might even start collecting string;-^
It may be time to dust off the term “the new normal” a reference created after the 2008 financial crisis to describe an economy mired in slow growth. The term has not been used much lately but has become the reality we face. Something that should make people concerned is that grinding stagflation is on the horizon.
Astrong case can be made that the economy is about to stall under strong headwinds as the burden of past debts and future promises made to those retiring and unable to find good jobs begins to weigh heavily upon society. The article below delves into the idea of slow growth coupled with stagflation.
To quote Mark Steyn, we’d need to find $20 Trillion lying around to have nothing in our pockets. Brokest nation in history.
perhaps they can locate the $10T missing @ DOD to take some of that pressure off.
they’re making enuf money with their drug, kiddie & organ running.
On the surface, today’s monthly budget statement was disappointing: in March the US Treasury brought in total receipts of $216 billion, below the $228 billion last March, versus outlays of a record $392 billion, resulting in a deficit of $176 billion, more than the $167 billion expected, and $68 billion more than the previous year. For the fiscal year through March 31, the total US budget deficit was $527 billion, compared to $459 billion on year ago.
Declining government revenue and long-term costs associated with an aging population are expected to continue pushing up the deficit. Over the past 12 months, the deficit stood at $651.5 billion, compared with $460.6 billion a year ago, an increase of over 40% Y/Y.
On a 12 month run-rate, the US deficit stood at 3.1% of GDP. A year earlier, that figure was a third less, or 2.2%.
More troubling is that in March the US government had its biggest one month outlay ever, spending a record $392.8 billion, $57 billion or 17% higher than a year ago.
The break down of March spending was as follows:
- Defense: $58 billion
- Social Security: 79 billion
- Medicare: $75 billion
- Interest on debt: $30 billion
- Other: $151 billion
However, the most concerning picture emerges when looking at the annual change in the rolling 12 month total. It is here that we find that, like last month, in the LTM period ended March 31, total federal revenues, tracked as government receipts on the Treasury’s statement, were $3.264 trillion. This amount was 1.3% lower than the $3.31 trillion reported one year ago, and was the fourth consecutive month of declines. This was also the biggest drop since the summer of 2008.
Why is this important? Because as the chart below shows, every time since at least 1970 when government receipts have turned negative on an annual basis, the US was on the cusp of, or already in, a recession. Indicatively, the last time government receipts turned negative was in July of 2008.
One potential mitigating factor this time is that much of the collapse in receipts is due to a double digit % plunge in corporate income tax, which begs the question what are real corporate earnings? While we keep hearing that EPS are rising, at least for IRS purposes, corporate America is in a recession. As for that far more important indicator of overall US economic health, and biggest contributor to government revenue, individual income taxes? As of February, the YTD number was $695Bn, just fractionally higher than the same period a year ago.
Weak corporate profits have weighed on government finances in recent years amid sluggish global economic growth, depressed energy prices and a strong dollar, among other factors. At the same time, government spending continues to rise as the population grows older and more people qualify for Social Security and Medicare.
The latest, and most troubling budget report in this economic cyle, comes as the Trump administration and Republicans in Congress are weighing proposals to further cut corporate taxes, which would lead to even steeper declines in government receipts, while boosting spending on infrastructure, which are likely to spark a broader debate about tax and spending policies.
As to whether the 4th consecutive decline in tax receipts is indicative of a recession as it has been in the past, we’ll just have to wait. If Trump indeed wants a lower dollar and even lower interest rates, this may be just the catalyst that assures he gets precisely what he wants, killing any hopes of Fed rate hikes for the foreseeable future.