The fiscal year budget deficit surged passed $1 trillion last month. Spending deficits necessarily mean more government borrowing and we’re seeing that in the numbers as well. Uncle Sam’s outstanding public debt grew by $450 billion in August alone.
The national debt stood at $22.02 trillion on Aug. 1 and surged to $22.47 trillion as of Aug. 27.
The federal government continues to spend money at an insane rate and is running up budget deficits reminiscent of the Great Recession era.
With one month left to go, the federal budget deficit for fiscal year 2019 eclipsed $1 trillion in August, according to Treasury Department data released last Thursday.
The price of gold whipsawed this week, driven up and down by various headlines. In this episode of the Friday Gold Wrap, host Mike Maharrey covers some of the big news that moved the markets. But he said that we need to keep our eyes on the big picture. All of this is happening in front of a backdrop of surging debt driven by central bank policy. How much do we owe and what does it mean for the future? Mike talks about it.
Last week we got the updated federal budget deficit numbers. At $867 billion, the 2019 fiscal year budget shortfall has already eclipsed last year’s deficit of $779 billion.
The out of control spending and spiraling deficits are concerning enough on their own terms, but they become absolutely horrifying when you consider that these budget shortfalls are happening during an economic expansion. You would normally expect numbers like this during a major recession.
That raises an important question: what’s going to happen when the recession hits?
The federal government continues to spend America into a black hole and has already topped last year’s budget deficit with two months left in the fiscal year.
The US budget deficit in July came in at $120 billion thanks to a surge in spending, according to data released by the Treasury Department.
Uncle Sam spent $371 billion in July. That was 23% more than the government spent in July 2018. The Treasury brought in $251 billion. That number was up 12% compared to July 2018.
Month after month, the Trump administration runs multi-billion dollar deficits. The national debt has ballooned to over $22 trillion. According to the most recent Treasury Report, the US has a net worth of negative $21.5 trillion. And this understates the problem.
As Wolf Richter of WolfStreet puts it, the US government has “debt out the wazoo.”
Is this sustainable?
The federal government set an all-time record budget deficit in February. And this is with a Republican in the White House. The GOP is supposed to be the fiscally responsible party. In this episode of the Friday Gold Wrap, host Mike Maharrey offers some interesting analysis that reveals spending money in Washington DC is really a bipartisan sport. He also talks about Thursday’s selloff in gold and silver, explains why dollar strength is something of an illusion and illustrates how the way “the market” thinks is often pretty dumb.
The US federal government ran an all-time record deficit of $234 billion in February, according to a Treasury Department report released on Friday.
According to Business Insider, the February 2019 deficit topped the previous high of 231.7 billion set in February 2012.
The national debt has pushed beyond the $22 trillion mark.
According to Treasury Department data released Tuesday, the national debt now stands at $22.01 trillion. When President Trump took office in January 2017, the debt was at $19.95 trillion. That’s a $2.06 trillion increase in the debt in just over two years.
As we pointed out in an article last week, the US federal government has added $1.5 trillion to the national debt over the last 12 months. As a result, the US Treasury Department is flooding the market with bonds. Meanwhile, the biggest buyers of US debt – China, Japan and the Federal Reserve – are shrinking their Treasury holdings. For the past several months, we’ve been saying this is a big problem for the US government that most people are overlooking. And we aren’t the only ones sounding warning bells.
Last week, the chair of the Treasury Borrowing Advisory Committee (TBAC) sent a letter to Steven Mnuchin containing what the Financial Times called “a bombshell.”
