Government posts biggest monthly deficit ever

[stockholmer]

http://www.washingtontimes.com/news/2011/mar/7/government-posts-biggest-monthly-deficit-ever/

"The federal government posted its largest monthly deficit in history in February at $223 billion, according to preliminary numbers the Congressional Budget Office released Monday morning.

That figure tops last February’s record of $220.9 billion, and marks the 29th straight month the government has run in the red — a modern record. The last time the federal government posted even a monthly surplus was September 2008, just before the financial collapse.

Last month’s federal deficit is nearly four times as large as the spending cuts House Republicans have passed in their spending bill, and is more than 30 times the size of Senate Democrats’ opening bid of $6 billion...................."


article source of info

http://www.cbo.gov/

[villager]

1. It's not cheap maintaining our rich masters in the lifestyles to which they're accustomed

n/t

[ejpoeta]

2. well we can't make the rich and corporations chip in.... so i guess there is nothing

else we can do.

[stockholmer]

3. the bond market will do it for you, as it looks in fear at a sovereign US debt load

The spreads on US T-bills will start to rise, causing higher interest rates simply to finance the exploding debt. These higher rates will have the unfortunate effects on several fronts.

Number one, your debt service expenses will surge to unreal levels (right now, the US pays around $600 billion a year in interest to debt service, this will climb to well over $1 to 1.5 trillion a year with a few hundred basis points in your long term/short term bonds prices). This makes the deficits even higher, so it is a self-fulfilling nightmare.

Number 2, the borrowing/financing costs for USA citizens private debt service will also explode, as mortgage rates, credit card rates, etc, will quickly move to nearly unpayable levels.

Number 3, the Fed has kept interest rates near zero for over 2 years, as a rise will stifle the economy even further. But the debt levels will force them to raise rates, as well as further print money (via the so-called Quantitative Easing programme). This will cause the further collapse of the US dollar (which is already down over 25 percent versus the Euro, Pound, our Swedish krona, etc in the last 6 months). This will lead to huge inflation in real terms (not the completely fake CPI index the Fed now uses, which is rubbish via underweighting of food/energy costs and totally manipulated with artificial, arbitrary hedonic adjustments).

Bottom line, the debt, which is ever-increasing due to a large part through the war-machine empiric expenditures and debt service loads (these 2 alone will cost you at least $2 trillion in 2012) will be the end of the current American monetary global regime, thus ending the current way of life there for 90% of the populace.