Analysis of the Deficit, Fiscal Cliff, and US Debt
4/18 Daily US Cash Deficit
The US Daily Surplus for 4/18/2013 was $13.6B…in short, the cash continues to pour in. The fat lady hasn’t sang yet, but there is no denying that total net revenues are now up 20% over last April. Assuming everything just evened out tomorrow, we would end the month with a $80B surplus. If this pace continues, topping $100B+ certainly seems well within reach.
All that said, I have to admit the revenues have surprised me…I had 12% penciled in…we are sitting at 20% and gaining daily it seems. However, I just want to be clear….these suprising and positive developments we have seen over the last couple of weeks in no way shape or form mean we are saved, out of the woods, or even close to having materially fixed any of our problems. Let’s say we end up at a $120B surplus…double last year. We are still talking about a $60B improvement in a $1,000B hole. Six months into the 2013 fiscal year, which had a $1.092T deficit, we have seen an $82B improvement, with a strong push lets say we get down to $900B. That’s still a $900B annual deficit…how do you get it to zero? While this month’s strong revenues are likely being driven by the 2013 tax hikes, moderately higher employment, and a pretty big run up in the stock market (until the last week or so)…seeing 10% + revenue growth again next year seems unlikely…without additional tax hikes, they should grow at roughly the rate of the economy.
So..to wrap this up…we are having a relatively good month…Hooray for us!! Just remember, this is a few weeks of data points in the vast economic ocean. If we are still seeing 20%+ revenue growth in 6 months (or even 3)…I’ll be happily pointing that out to the world….but in the meantime, I’m not holding my breath.