Tag Archives: federal budget

Paul Ryan’s Budget Arithmetic Makes No Sense | zero hedge

How is lowering the corporate tax rate going to change that exactly? Uh, it’s not. What it would do, is create a wider budget gap and send more politicians scratching their heads over why. So, it’s really just a super-bad and dumb idea.

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Federal deficit: who owns what? |fst

Timothy Geithner, US Treasury Secretary

Timothy Geithner, US Treasury Secretary

Reports from last month reveal that the US federal deficit had been catapulted to record territory in August, hitting $1.38 trillion with just one month left in the budget year.

It remains a concerning figure – not least because of the worries it has raised regarding the willingness of foreigners to continue purchasing Treasury debt. For that is where the debt comes from: US Treasury securities – a government debt issued by the United States Department of the Treasury, which other countries and institutions then buy.

In essence then, Treasury securities (in this case, Treasury bonds) are nothing more than glorified loans – and as the US Treasury releases data pertaining to this – it is becoming increasingly hard for the American people to get a grasp on the fact this is how their country borrows money.

If its any consolation, it should be noted that this is how all governments borrow money, so the US isn’t alone: but with America’s deficit now soaring to an incredulous height, concerns seem to not only be justified but also gaining impudence.

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