US Daily Cash Surplus 6/11/2015

The US Daily Cash Surplus for Thursday 6/11/2015 was $1.6B bringing the June 2015 deficit through 11 days to $63B.

2015-06-11 USDD

Tax revenues should start flowing in over the next few days, including ~$50B of corporate taxes Monday which will likely push the deficit to surplus.  As it stands, revenues are up 4.5%…not too shabby, with outlays still being up big due to the timing issues discussed in the last post. Pull that out, and we are probably in our standard range of +1-3%. By the end of the week, we should have a much better feel for where revenue is headed, though revenues should remain elevated for the rest of the month.

May 2015 Cash Deficit

The US Daily Cash Surplus for Friday 5/29/2015 was $2.4B bringing the May 2015 Cash Deficit to $104B for the month.

2015-05-29 USDD



Revenues were up nearly $10B good for a 4.5% YOY improvement. May 2015 had one less business day, so adding that in and we would have been between 6-7%…not as impressive as April’s +13.5%, but good enough.


Outlays were down $31B, but all of that is related to timing as in 2014 $30-40B of payments due 6/1 went out in May since 6/1 fell on a weekend. May’s gain will be June’s pain, expect it to start with a big hole

Deficit: On increased revenues and decreased outlays, the deficit was down $40B vs May 2014. Pulling out timing events, I’d guess we were more or less flat

YTD: We are now 5 months in, and revenue is up 9%. Outlays show flat, but adjusted for timing I’d put them at +3%. That leaves us with the deficit itself with a $103B YOY improvement.

June Outlook: My initial May deficit forecast was $100B, not far off from the $104B actual. June is a quarter close month, which means it should have fairly strong tax revenues. Last June posted a $78B surplus, but due to the timing discussed above, I am putting my initial June 2015 forecast at a $50B surplus. In this number is 8% YOY baseline revenue increase based on what we saw in May, plus an extra business day in 2015 over 2014. Offsetting that, I expect Fannie/Freddie dividends to continue their plunge, maybe coming in at $2-3B vs $10B a year ago. Outlays will be up big….including a 3% baseline plus normalized timing picking up in June the outlays that went out in late May in 2014.

D-Day:  We ended the month of May with $199B of cash, down from $275B to end April. I’d guess they also burned through another $30B of “Extrordinary Measures” (EM), bringing the total to $130B since they started in March out of an estimated $350B at their disposal. Last month I estimated the cash available for deficit spending was at $525B…as of the end of May I would lower that to $199B cash+$220B EM, so $419B. This puts default day in mid February-2016…unless of course the debt limit is raised, which we all know it will be.



US Daily Cash Deficit 5/28/2015

The US Daily Cash Deficit for Thursday 5/28/2015 was $1.7B bringing the May 2015 deficit with one day remaining to $106B.

2015-05-28 USDD

Revenues are sitting at +4% and outlays at ~+2%. Not a great month by any stretch, but progress nonetheless. Friday will likely run a $5-10B deficit, still leaving us well under last May primarily due to favorable timing…last May ~$30B +of outlays due 6/1 were pulled into May….this should not repeat as June 1 is on a Monday this year. Next Up…June, which should run a solid surplus in the ~$50B range as quarterly tax payments should boost revenues by ~$140B over May. As always revenue will be key…anything over 5% is pretty good news.

US Daily Cash Deficit 5/21/2015

The US Daily Cash Deficit for Thursday 5/21/2015 was 5.1B bringing the May 2015 cash deficit through 21 days to $91B.

2015-05-21 USDD

Revenues are back up over 2014 running at +3.7%. Given that May 2015 is down a day, this is a respectable number, even if it’s only a $6B gain. Outlays are up 1% ($3B) giving us a 3B deficit improvement vs 2014 so far. My initial forecast was a $100B deficit for the month, but we appear to be headed a bit over that…say $105-115B. Month end timing is going to cloud the YOY, so right now is probably a clear snapshot of the May baseline….revenue up ~4%, outlays up 1%. Probably won’t make any headlines, but if slow and steady wins the race, this will go down as an ok month. For the year,revenue is at +9% and outlays are at 3.5%.

Just a flashback….the trailing 12 month cash deficit peaked in 9/2009 at $1.817T….as in Trillion. Since then, driven primarily by increased revenues and flat cost, we are closing in on 6 years of more or less uninterupted deficit improvement, probably ending up under $500B at the end of May. Yes…$500B is still a huge number, and yes there are demographic time bombs around the corner, and yes…there could be a recession any second now, but still….crossing the $500B threshhold is something I would have never predicted 3 years ago as I was preparing to launch this blog. My best guess back then was stabilization around $1T for a few years before zooming to infinity and beyond. So…where are is the deficit headed? Down to zero or back to $1T+?

I honestly don’t know, but pulling out a ruler and following this trend, we look to be on track to finish 2015 at about a $400B deficit per year rate. If we assume revenue grows at 7% from there, and outlays grow at 3%, our 2016 deficit is 272B, 2017 is $130B, and 2018 hits a $26B surplus. Is that my forecast?….nope….i don’t have one because my crystal ball is quite broken. The primary question would be….How do we grow revenues 7% when population growth + inflation is maybe 3%??? Hell if I know but that’s more or less what we’ve done for the last 5-6 years, so why not another 3-4… Don’t get me wrong….I’m definately not in the optimist boat here, but it’s getting hard to not to take a look in the rearview mirror and at least notice that things are a hell of a lot better than they were…just look at the bottom right chart above for annual deficit through 141 days. In mid May 2009 we were sitting on a $764B deficit….2015 is less than 1/4 of that at $176B.

**I do realize of course that by letting an optimistic thought out of my head, I’ve probably doomed us all to another great recession…sorry about that 🙁