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Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and that is a c

Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

welp, there's our recession kickoff event. this will be way worse than 2008, too.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and that is a concern - MarketWatch

As usual, the deficit skyrockets with a gop president.
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The deficit was kept low under Obama because he borrowed trillions to keep it low, adding trillions to the US debt. Americans should be more concerned about the debt than the deficit. The US cannot default on the deficit but if it defaults on its debt it will be in big trouble.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
The deficit was kept low under Obama because he borrowed trillions to keep it low, adding trillions to the US debt. Americans should be more concerned about the debt than the deficit. The US cannot default on the deficit but if it defaults on its debt it will be in big trouble.
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Please explain to everyone how you can borrow money to reduce the deficit.

Also, please explain how you "default on the deficit."
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

Financial markets are begging the government to borrow money as ten year bonds real rate is 0.02%. This is a great time to borrow money for infrastructure.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
The deficit was kept low under Obama because he borrowed trillions to keep it low, adding trillions to the US debt. Americans should be more concerned about the debt than the deficit. The US cannot default on the deficit but if it defaults on its debt it will be in big trouble.
Click to expand...
The decifit under Obama started dropping after the GOP took control of the House.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
The deficit was kept low under Obama because he borrowed trillions to keep it low, adding trillions to the US debt.
Click to expand...


:lamo
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
The deficit was kept low under Obama because he borrowed trillions to keep it low, adding trillions to the US debt. Americans should be more concerned about the debt than the deficit. The US cannot default on the deficit but if it defaults on its debt it will be in big trouble.
Click to expand...

Well it is a little more than that. He borrowed on lower interest 10 year bonds instead of longer term higher interest 30 year bonds and now all those bonds are reaching maturity.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and that is a concern - MarketWatch

As usual, the deficit skyrockets with a gop president.
Click to expand...

The article is nonsense and another scare tactic. First the government does not only borrow short term thus inverting the yield curve as the article suggests. With long term yields so low worldwide, there have even been calls for the government to sell 50 and 100 year treasuries. Certainly should sell a ton of 10,20 and 30 year bonds with yields at multi-year lows.

Not in favor of high deficits. That being said tired of phony,partisan articles to scare the unwashed.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

JohnfrmClevelan said:
Please explain to everyone how you can borrow money to reduce the deficit.

Also, please explain how you "default on the deficit."
Click to expand...

Deficit spending is spending more than you have in the bank. If you borrow money to add to your bank account then you have more money in the bank which lowers the ratio between what you spend compared to what you have in the bank.

It is impossible to default on the deficit. That is the point I was making. The deficit is not what is threatening the US with bankruptcy, the debt is.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

JohnfrmClevelan said:
Yeah, but the article is rubbish. The increased debt won't pose a problem.

You read it here first.
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How is the size of the US debt not a problem? Do you subscribe to the idea that the US will never have to pay its debt so never will pay the debt?
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
Deficit spending is spending more than you have in the bank. If you borrow money to add to your bank account then you have more money in the bank which lowers the ratio between what you spend compared to what you have in the bank.
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That's not how it works. The deficit/surplus is the difference between what you spend and what you bring in via taxation. You can't change that by borrowing.

What you borrow to pay for the deficit spending adds to the debt. So if you have a $1 trillion deficit, you will add $1 trillion to your national debt.

marke said:
It is impossible to default on the deficit. That is the point I was making. The deficit is not what is threatening the US with bankruptcy, the debt is.
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There is no "bankruptcy" for nations. And we are able to pay any obligation in dollars, so there is no operational chance of default - just a political one if Moscow Mitch decides to default.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

marke said:
How is the size of the US debt not a problem? Do you subscribe to the idea that the US will never have to pay its debt so never will pay the debt?
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Yes, the U.S. doesn't need to extinguish it's debt. That debt is our savings and a lot of our dollars.

Look at the pile of debt - it's been there for most of our 200+ years, just getting bigger as we get richer. Jackson tried to pay it off, and sent us into a depression.

If you believe differently, explain why the U.S. needs to extinguish those liabilities.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

Mycroft said:
Treasury wouldn't have to do this if Congress did their job.
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Yep. The last congress should not have passed that irresponsible tax cut.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
Yep. The last congress should not have passed that irresponsible tax cut.
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That tax cut brought in more revenue. Congress spent it...and then some.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

Mycroft said:
That tax cut brought in more revenue. Congress spent it...and then some.
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LOL. No it didn't. It brought less. Caused a trillion dollar deficit.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
LOL. No it didn't. It brought less. Caused a trillion dollar deficit.
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no matter what the Right keeps talking about how much Obama ran the debt up but is not saying a word about what Trump is running it up
In his first fiscal year Trump has run the debt up more then Obama did in 5 out of the 8 years he was in office.
and in he second year that ends at 001 Oct 1 2019 Trump has already run it up more then 3 of the Obama years
and this is in what Trump calls a good economy.
Just think of what Trump and the Republicans would have done if they took over the Economy G W Bush left Obama
Have a nice day
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and that is a concern - MarketWatch

As usual, the deficit skyrockets with a gop president.
Click to expand...

The problem with the article is the absence of discussing economic reason for a deficit increase.

If we were paying attention to economics, which is of course usually not the case for politics, we would be asking ourselves the question: if the economy is doing so well why do we need to increase deficits?

When the economy is doing well, with at least a high percentage being on its own merit, then the government should not have to increase deficits to keep that going. Government spending is always part of the economy anyway, but any growth becomes artificial if it is reliant on that spending. And that ends up creating a condition where you have to continue to add to deficits to keep the trend no matter how bubble and pop the trend may be.

Given the indicators we were seeing, between say 2012 to 2018, deficits should be falling. And they were until around 2016 when Congress decided otherwise. Some of that was social safety net costs at first, then Congress decided the wealthy needed a tax cut and deficits are now what they are.

We already know that the Treasury has broken a few auction records in recent years, we already know our fiscal condition now is headed the wrong direction.

When the next recession hits, not if... when, we will be facing a condition where deficits are increasing *at the same time* we face some economic fault causing a recession. The deficits Bush 43 / Obama put up will become a footnote to the record debt additions we will have to deal with in order to handle the next mess.

Our conclusions are the same. Trump and Republicans in the last Congress made a critical error, rewarded their buddies, and put the nation in the worst fiscal condition with the next recession right around the corner.

We will break more auction records, there will be concern with the evaluation of the dollar (which still competes with an international basket of currencies,) and yields will be a joke.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

Mycroft said:
That tax cut brought in more revenue. Congress spent it...and then some.
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That tax cut was ineffective. It went primarily to people that just save their money.

If you increase spending, you will increase tax revenues. That should be a given. Government spending is a straight addition to commerce; if you deficit spend $1 billion more, that's $1 billion, plus secondary spending, added to the national income, which means higher revenues. We should all be able to agree on that, I hope.

If you give a tax cut to people who spend their new windfall, that also increases the national income, which increases tax revenues.

If you give a tax cut to people who save their new windfall, that doesn't increase the national income, and it doesn't increase tax revenues.

The tax break for corporations probably boosted investment somewhat, but investment is still based on a business' estimation of how profitable their investment may or may not be. That has far more to do with expected demand than it does the tax code. All of those stock buybacks resulted in higher tax revenues, as did any boost to the stock market, but that's a one-time thing. People will likely be writing off their stock market losses this year.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

Mycroft said:
That tax cut brought in more revenue. Congress spent it...and then some.
Click to expand...

That is not entirely accurate, what it actually did was put more towards corporate stock buy backs and put the remainder at rest.

Ultimately what the tax cut did not do was jump start economic investment, because aggregate demand was not sitting there waiting for that investment.

What it did do was immediately cause additions to deficits, and then treasury went back to breaking a few auction records.
 
Re: Treasury is about to flood the market with debt to fund U.S.’s $1 trillion deficit — and tha

99percenter said:
LOL. No it didn't. It brought less. Caused a trillion dollar deficit.
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The Treasury Department reported this week that individual income tax collections for FY 2018 totaled $1.7 trillion. That's up $14 billion from fiscal 2017, and an all-time high. And that's despite the fact that individual income tax rates got a significant cut this year as part of President Donald Trump's tax reform plan.

Overall, federal revenues came in slightly higher in FY 2018 — up 0.5%.

Spending, on the other hand, was $127 billion higher in fiscal 2018. As a result, deficits for 2018 climbed $113 billion.

Access to this page has been denied.
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Like I said...tax reform brought in more revenue and Congress spent all of it...and then some.
 
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