Daily Treasury Statement

The US Daily Cash Deficit for 9/19/2013 was $1.7B bringing the September 2013 Surplus through 19 days to $34B with seven business days remaining. We are still seeing strong cash inflows from “taxes not withheld” at $5.7B, but they do appear to be tapering down, which is what we would normally expect….ending under $1B per day by late next week. As it stands today, YOY, corporate taxes are up 1%, excise taxes are up 5%, taxes not withheld are up 7%, and taxes withheld from paychecks are up 12% :(.

All together, revenues made up another $1B of ground yesterday but are still $2B under  September 2012 thanks to the decrease in TARP repayments. Another day…no surprises.

The US Daily Cash Deficit for 9/18/2013 was $1.5B bringing the September Surplus through 18 days to $36B with 8 business days to go.

Taxes “not withheld” continue to come in strongly as expected making up the ground lost yesterday and then some…perhaps a sign that  another strong finish is on deck?? Revenues are still down $3B vs last year, but if you take out the $20B Tarp revenue from last September and it doesn’t look half bad at +8%.

Using 2012 as a guide, the last 12 calendar days of last September posted an $8B deficit, suggesting that we would end this September at a $28B surplus. However, I have to think we’ll do better than that even if we don’t see an end of month revenue surge. Between moderately higher revenues, an extra day, and some generous contributions from Fannie/Freddie, we are probably on track for a $50-$70B surplus without any surprises.

The US Daily Cash Surplus for 9/17/2013 was $3.0B as $9.4B of taxes “not withheld” were deposited in federal accounts Tuesday resulting in a rare Tuesday surplus. Still…revenues edged down about $1B from year ago…could be small timing issues, but we won’t know for a few more days.  Remember this is the category that surged 40% YOY back in April and 16% in our last quarter end (June).  With 9 full business days remaining, they are currently down 1%. It’s not time to panic…yet…we should continue to see strong inflows from this source for the rest of the month, but obviously this isn’t where we want to be with more than half of the month already in the books.

On outlays, I have a correction to make. Treasury issued a revised DTS for 9/3, with the net effect being a $14B decrease in outlays. It was issued a few weeks ago around the time I was on vacation, but I just glanced at it today and corrected my database…The revised numbers actually make a lot more sense. All month long, I’ve been seeing a ~+$40B of outlays, while timing was only explaining about $30B. So with the revision, we are at +28B, which indicates a small marginal reduction after adjusting for timing, consistent with what we would expect with sequestration ongoing. Yesterday I made some comments indicating that reaching the $70B surplus I had originally forecast was going to be a challenge…I’ll need to re-evaluate that in light of this $14B pickup, but I will probably wait for a few more days of data.

The US Daily Cash Surplus for 9/16/2013 was $62.1B as the much anticipated quarterly corporate taxes started flowing in….soon to be followed by individual quarterly payments over the rest of the week. In yesterday’s USDD, I mentioned that the year ago surplus (9/17/2012) had been $54B, and that topping that by $5-10B would be a pretty good indicator. We got +$8B….which is pretty good….it doesn’t Wow!! me, but it should be seen as a pretty solid sign that revenues are not going to fall off a cliff or anything(well…except for the TARP piece).

Yesterday’s revenue haul brings us back within $4.5B of last years revenue, now down only ~2%. Corporate taxes, which had been down 15% are now up 2%, and taxes not withheld are up to +8% from 4%. Revenues should continue to flow strongly for the rest of the week….what we are interested in is how strongly. My initial forecast for September 2013 was a $70B surplus. Although it is still early, this is starting to look like a bit of a stretch since we are currently at $20B surplus through 16 days. Pulling in another $50B surplus from here out looks unlikely, but if tax receipts over the next week or so come in stronger than expected, it’s not impossible, especially since September 2013 has an additional Monday (9/30) which we didn’t have last year. The combination of the extra day of strong Monday inflows could be enough, but I won’t be holding my breath.

**update**

It did just occur to me that Fannie and Freddie will be making their quarterly payments to treasury later this month…Last year, that was good for about $5B. I wouldn’t expect another $60B payment payday loan like we saw in June, but It will probably exceed last year’s $5B by a healthy margin, making the $70B a bit more likely than I implied when this was originally posted

The US Daily Cash Surplus for 9/13/2013 was $11.2B pulling the September 2013 cash deficit through 13 days to $42B.

You may notice that revenue, which had been up about $8B vs 2012 has flipped and is now down $12B. Most of that is due to a $21B TARP payment received a year ago compared to a meager $42M yesterday. TARP “revenue” has more or less slowed to a trickle at around $2B per month and is no longer a material source of revenue. As we have been expecting, we received about $10B of corporate tax revenue Friday compared to $12B a year ago, but given the timing, I would think there is a decent chance we catch back up with Monday’s haul.

On the month, while taxes withheld are up 11%, corporate taxes are down 15%, excise taxes are down 1%, and taxes not withheld are up a meager 4%. This, along with the large reduction in TARP revenue has pushed the YOY revenue down 9%. I don’t expect this to last….I am currently expecting September revenue to come in between +5% and +10%, but that is assuming we see strong gains across the board this week, especially in taxes not withheld and corporate taxes. Through 2 full weeks, we are about where I expected us to be…now we’ll just sit back and see whether the quarterly tax receipts come in.  The corresponding Monday from last year ran a $54B surplus, so we would hope to exceed that by $5-10B. We’ll know by 4 pm (E) tomorrow when the DTS is released.