The US Daily Cash Deficit for 9/3/2013 was $34.7B starting off the month with a bang. The first round of SS payments went out at $24B, as did $6B of interest payments. This is all more or less in line with expectations…one down, 19 business days to go.
Revenues are a bright spot…kicking off the month at $+4B already, but honestly it is way too early to read too much into this.
The US Daily Cash deficit for 8/30/2013 was $36.5B bringing the August 2013 Cash deficit to $173B over the full month. This is a $38B improvement over last August at $211B, but after adjusting for about $25B of timing, it reflects a only moderate $13B improvement.
The story is all in revenues…up a meager $1B…less than 1% in a year that averaged 18% YOY increase over the first 6 months thanks to tax increases, moderate increases in employment, and of course, a $60B payday loan from Fannie Mae. Digging into the details…it wasn’t all gloom, tax deposits were actually up $8B…offset by an $8B decrease in TARP Receipts…an issue I detailed 9 months ago in We Won’t Miss TARP, But Uncle Sam Will. We’ll see this again in September as last year’s $23B of TARP revenue is likely to fall down to $1-2B or so.
Overall, I have to say this was clearly a disappointing month, but I’m not sure yet if the revenue slide is just an anomaly, or a bona fide shift in the trend. September should give us a pretty good idea which…especially the corporate tax deposits and the “taxes not withheld”. I’ll try to do a more detailed write up later in the month, but this will have to do for now…
The US Daily Cash Deficit for 8/29/2013 was $3.6B bringing the August 2013 Cash Deficit to $136B with one business day remaining. Revenues finally surpassed the pace set by last year by $1B, and another $10B or so on 8/30 would put us at YOY growth of a meager 1%. For reference, the first 6 months of 2013 ran at +18%, and July came in at +9%.
Interesting…. though I am inclined to average them together….at 5% revenue growth. This, to me, seems like what may emerge as the new normal…not the 11-12% the CBO has forecast for the next couple of years. With a $3T annual revenue baseline, the difference between 5% and 11% growth is about $200B in 2014 and $400B in 2015….and it grows exponentially from there.
With one day remaining….expect a $30-40B deficit tomorrow (well…8/30) substantial, but less than the $64B deficit posted on Friday 8/31/2012, since that day included ~$25B of SS payments due 9/3, but pulled forward due to Labor Day.
Outlays are worth noting today since come tomorrow they will be thrown out of sync….are down $10B. Just scanning through the categories…Defense vendor payments are down $6B and Education Dept outlays are down $3B, with other categories having smaller variances up and down. $10B is a 3% reduction YOY….not too shabby given the offsetting increases in Social Security…but unfortunately, I don’t see this trend lasting beyond the fiscal year end. That said…I didn’t think sequestration would stand, and I was wrong (though pleasantly surprised) on that.
The US Daily Cash Deficit for 8/28/2013 was $10.6B bringing the August 2013 deficit through 28 days to $133B with two business days remaining. $12B of Social Security payments went out today…the last payment of the month, bringing August 2013 and 2014 as close to in sync as they have been all month. Revenues are back down YOY $2B under last year’s pace, but there is a good chance they will catch back up tomorrow as a few $B of excise taxes are likely to trickle in. Outlays are also down $10B, resulting in the deficit being down $9B(rounded) vs last year. Without a doubt…improvement is a good thing…we’ll take it…but this kind of meager improvement is substantially less than we have become accustomed to seeing.
So…with two days to go…expect a small deficit for Thursday, followed by a large Friday deficit…likely in the $30-$40B range as September payments get pulled into August by the timing of the weekend and the Labor Day Holiday. Thanks to the holiday, we won’t have our final August numbers until next Tuesday 9/3, but I don’t mind waiting.
The Us Daily Cash Deficit for 8/27/2013 was $5.9B bringing the August deficit through 27 days to $122B with three business days remaining. Revenues have finally pulled even to August 2012’s pace at $179B…likely on track to edge out August 2012’s $204B of revenues by a few billion or so.
With three days left…August is looking like a big disappointment…with flat revenues, and adjusted for timing, more or less flat cost….where we are really looking for +10% revenues and 1-2% reduction in outlays to match earlier month’s performances. This would make two in a row…though we should probably average them together….I’ll do that once the finals are in. Obviously…if August ends like that…it won’t be a good thing, but September Revenues is what I am most interested in. Quarter ends are always stronger in revenues….and subject to more uncertainty. If we see solid YOY revenue gains across the board…it will be good news…or at least more of what we’ve seen over most of 2013. If…however, revenues disappoint for the third month in a row, it will be a pretty good sign that trouble’s a brewin…and the pony ride that the first half of 2013 has resembled is just about over.