Just as we have been predicting and warning, the US once again finds itself with a one trillion dollar deficit. The “official” figure from the government is $984 billion, but don’t be fooled, given some fuzzy accounting, we actually have to look at the year over year increase in the national debt. This figure takes us closer to $1.4 trillion. This deficit is the largest since 2012 when the US was making its way out of the Great Recession. Not that trillion dollar deficits were warranted and justified then, but at least they existed due to a major economic and financial collapse – not seen since the Great Depression. Now? We’re told we’re in the midst of the greatest economy ever in the history of the United States. Then why the trillion dollar deficits? Perhaps things aren’t as great as some would like us to believe.
Nevertheless, the major US market indexes are nearing or have hit new all time highs. This is likely on the back of earnings reports that have not been as bad as some were led to believe and a continuation of market manipulation headlines and statements around US/China trade talks. We’re also rather certain that the market is pricing in further interest rate cuts and is enjoying the $60B/month liquidity that the Federal Reserve is pumping into the markets. At $60B/month, the Fed will have expanded its balance sheet by $720B come this time next year. With trillion dollar deficits, this means that the Fed is basically monetizing roughly 70% of Uncle Sam’s poor spending habits. We also imagine that the Fed will have to do even more by this time next year – meaning larger amounts of money printing, even lower interest rates, and possibly some “other” tools will be employed.
There is no leadership in this country and The Kapital News feels for the younger generations and even those generations yet in existence, for they did not vote for these horrendous and wasteful policies, but they’ll sure have to pay for them. They’ll be paid for in higher taxes, higher rates of inflation, thus lower living standards, and fewer opportunities in the job market – a scenario that is already being realized. Debts and deficits, especially of this magnitude are immoral and unethical. But how can we be surprised when that’s exactly how our elected officials act? Stay diversified, stay vigilant, and stay with The Kapital News. #Deficits #Debt #Recession #Economy #EndTheFed #Truth #Justice #Peace #TradeWar #USA #China #Invest