Daily Treasury Statement

The US Daily Cash Deficit for 10/3/2013 was $28B on typically weak Thursday revenues and $24B of social security payments.

After starting in a $10B hole, revenue has made some progress, narrowing the gap to $8B….we need to get to about +$20B by month end to show 10% growth. Still plenty of time, and we’ve been seeing stronger revenues in the second half of the month over prior years for some reason. Outlays are down, primarily from timing, but also about $3B so far of bona fide reductions. Don’t blame (or credit) that on the shutdown though…those paychecks wouldn’t even go out for a week or two anyway. 800k workers at $75k per year pencils out to $60B per year, $5B per month, and about $250M per day of savings…or lost wages… It’s not chump change, but it’s hardly material.

Cash was down $33B from $57B 10/2 to $24B 10/3. Looking at the rest of the month, there really aren’t any large inflows or outflows left on the calendar other than the next 3 social security payments and a ~$7B or so of corporate tax revenues around the 15th. Other than that, I’d just expect moderate deficits and surpluses most days as we slowly march up to ~$90B or so. Also looking at the calendar…I noticed that 11/3, when the first ~$25B  social security payment of November is due is a Sunday, which means it will go out Friday 11/1 instead. This makes it likely that 11/1 is a pretty solid guess for the absolute latest the debt limit deal must be reached. It could obviously still happen before then, but making it past 11/1 and those $60B or so of outflows looks unlikely unless treasury has more “EM” magic left than they have been letting on.

**So much for government shutdown savings….I just read that an agreement has been reached to pay people to not work….seriously…this is the only damn thing they can agree on…to pay people not to work!! So we shut down the government, the monuments ect, take people’s blackberries and order them not to work…..then agree to pay them to not work. Sounds to me like being a “nonessential” government worker is turning out to be a pretty sweet gig. Is it really a surprise to anyone we can’t get our fiscal house in order?

The US Daily Cash Surplus for 10/2/2013 was $7.1B pulling the October Deficit through 2 days down to $27B.

Revenues look like they staged a comeback after being down $10B yesterday, but it’s really just timing….10/2/2012 was a Tuesday, which generally has weak revenues while 10/2/2013 was a Wednesday, which generally has strong(er) revenues. I may sync the days up after the weekend….it’s not perfect, but it will give us a bit better YOY comparison once we get into the middle of the month. For now, we are comparing 2 days of October 2013 to 2 days of October 2012.

Outlays look to be down $6B….but about $5B of interest due 9/30 was paid 10/1 last year…pulling that out, we are more or less in line.

Cash was up $7B on the surplus to $58B which is good because we are likely to post a ~$30B deficit 10/3 as the first round of Social Security payments go out. Just eyeballing it, it looks like there may be about $40B of extraordinary measures left in the tank. If that’s true(??)…It looks to me like we can probably make it past 10/17, but probably not past the heavy outflows of early November…ending with the 11/3 $25B Social Security payment. At that point, all you have to spend is your incoming cash, leaving an average shortfall of $60-70B per month, though the actual shortfalls/surpluses swing drastically from month to month. Coincidentally….Social Security is about $62B….cut that and crisis averted, budget balanced. Who wants to run on that in 2014? Didn’t think so!!

It’s not really a surprise, but the day after we post a $24B surplus….we go and post a $33.7B deficit to kick off October.

It’s a bit early to really start doing YOY comparisons, but we can immediately see that revenue is starting in a $10B hole. What has probably happened is that timing has pulled about $10B into September…helping to post that rather impressive 14% YOY gain. Unfortunately, we’ll probably see the other side of that in October, so when you average them out, it may not be so impressive after all.

Cash in hand was down $38B to $51B with a $25B social security payment set to be paid Thursday. According to Treasury, we have about 2 weeks before things start getting hairy…stay tuned.

The US Daily Cash Surplus for 9/30/2013 was $24.2B pushing up the monthly surplus to $59B for the month just barely topping last year’s $58B surplus. For the day, revenues came in big at $41B on strong tax deposits and about $15B from Fannie/Freddie. The last day revenue surge picked up revenues sitting at +$2B (0.7%) YOY on 9/27 to +$43B, good for an impressive 14% YOY gain. Part of that was the extra business day, but hey, we’ll take it!!.

At first glance, September was a solid month with impressive revenue gains, offset by cost increases that were primarily related to timing and an extra business day.

More to come over the next few days…just wanted to get this out.

The US Daily Cash Deficit for 9/27/2013 was $1.5B bringing the September 2013 Surplus through 27 days to $35B. I half expected a moderate surplus today, but it wasn’t to be.

So at this point, we are comparing all of September 2012 to September 2013 with one (extra) business day remaining. Revenues are back to flat at only +$2B (0.7%) YOY. Part of that is timing….the last day of the month often has higher than average revenues as special payments are made….like the Fannie/Freddie payments. last year those happened on 9/28..a Friday. this year they will happen on 9/30, a Monday. So we will likely see heavy inflows Monday.

My beginning of the month forecast was a $70B surplus, but that is looking a bit optimistic at this point sitting at $35B, with only one day left. There’s a lot of uncertainty, but we will likely see a large surplus 9/30, I’d guess in the $15-$25B range…$35B would be quite a surprise to me. We’ll find out tomorrow…assuming Treasury is still publishing the DTS during the apparently imminent government shutdown.