Uh Oh… Exploding Deficit
What’s Going On in Washington?
That’s what’s going on in Washington. Seriously, it is almost like their disconnection from financial reality has as last become complete.
And it has. Here are the facts for November:
Federal spending for the month was $501 billion.
Federal revenue was $252 billion.
You probably already figured out for yourself just how gigantic the November deficit was. It you thought it was about a quarter of a trillion dollars, you are right there in the ballpark: It was a record $249 billion.
That implies an annual deficit of $3 trillion.
This is so far from manageable as to make mature, responsible people break down and cry. Former US budget director David Stockman (himself a mature and responsible person) asks, “In exactly what universe, therefore, is that not inflationary?
By the way, why did federal spending come in so high, up 53 percent from the same month last year? The answer is debt service. As we have all noticed, the Fed has been prodding interest rates higher, and Washington suffers those higher rates just like the rest of us.
Check out the sharp spike on the far right-hand side of an already skyrocketing chart of Federal interest rate expenses:
Want more spending news? Probably not, but here it is anyway.
By a vote of 83 to 11, Congress has now passed a record-busting $858 billion National Defense Authorization Act. It is headed to the White House for President Biden’s signature.
Will Biden sign it? Of course, he will, even though it is $45 billion more than he asked for.
By the way, the bill includes $10 billion for Taiwan, which will be used to purchase weapons from US arms manufacturers.
There’s more. Ron Paul writes that more money is being shoveled into the Ukraine black hole. “Senate Majority Leader Chuck Schumer has signaled that the next huge check – nearly $38 billion – will be conveniently hidden in a year-end, must-pass omnibus bill. It’s a way to keep the gravy train flowing while sparing Members the inconvenience of having to face voters.”
Meanwhile, even mainstream news outlets are noticing the popping of the central bankers’ Superbubbles. He’s a clip from The Hill: “While recent crashes in British bond prices, real estate in China, and stocks in the U.S. were driven by different catalysts, they all reflect a common cause largely ignored: the popping of a worldwide wealth bubble.”
And here’s a disturbing number from CNBC: “As of November, 63% of Americans were living paycheck to paycheck, according to a monthly LendingClub report — up from 60% the previous month.”
Doesn’t it just make you want more gold and silver? It does us, too!