The Federal Reserve has lost well over $100 billion dollars, and even when it returns to “profitability,” it will likely take over four years before the central bank is completely in the black.
And you’re going to foot the bill.
Everybody seems convinced that the Federal Reserve has won the inflation fight, there will be no more interest rate hikes, and rate cuts are right around the corner. But as Friday Gold Wrap host Mike Maharrey reminds us, it’s not over until the fat lady sings. And she hasn’t sung a note. In this episode, he breaks down the latest CPI data and explains why the victory dance might be premature.
On Friday, Moody’s Investor Service lowered its outlook on US government credit from “stable” to “negative.” This could be a prelude to a downgrade in the country’s AAA credit rating. The agency typically resolves an outlook by either revising it back to stable or executing an actual downgrade within 18 to 24 months.
There is a $33.7 trillion elephant in the living room.
I’m referring to the massive national debt.
It’s pretty amazing that we have this massive animal sitting right in the middle of everything and most people are just walking around it as if it isn’t there.
A lot of people don’t think it does, at least not yet. They point to Japan as an example of a country that has a much higher debt-to-GDP ratio and is doing fine. Peter Schiff said they’re looking at the wrong country. The US is more like Argentina than Japan.
The Biden administration ran a $1.695 trillion budget deficit in fiscal 2023. It was the third-largest deficit in US history. The only time the US government ran bigger deficits was during the COVID years of 2020 and 2021.
The government closed out the year with a $170.98 billion deficit in September, according to the final Monthly Treasury Statement of the fiscal year. That was more than double the projection.
That’s how long it took the Biden administration to add another half-trillion dollars to the national debt.
Bidenomics certainly requires a lot of borrowing and spending.
The national debt recently blew past $33 trillion. And yet with the exception of a few intransigent Republicans, there is virtually no discussion about reining in spending.
Congress managed to avoid a government shutdown by passing a continuing resolution that did very little to address spending. But as Ron Paul points out, there was a small victory in the CR that could bode well for the future.