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on November 30, 2008 04:42 PM
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Published in : The News, The News |
In keeping with the tradition of rosy scenarios, official budget projections suggest this deficit will be relatively short-lived. They Fully Automated Forex System almost always do. According to the official calculus, following a second $400-billion-plus deficit in 2009, the red ink should fall to $160 billion in 2010 and $95 billion in 2011, and then the budget swings to a $48 billion surplus in 2012.
If you do the math, however, you might be forgiven for sensing that these felicitous projections look a tad dodgy. To reach the projected 2012 surplus, outlays are assumed to rise at a 2.4 percent nominal annual rate over the next four yearsless than half as fast as they rose the previous seven years. Revenue is assumed to rise at a 6.7 percent nominal annual rate over the next four yearsalmost double the rate of the past seven years. Using spending and revenue growth rates that have actually prevailed in recent years, the 2012 surplus quickly evaporates and becomes a deficit, potentially of several hundred billion dollars.
Doing deficit math is always a Trading Master Plan sobering exercise. It becomes an outright painful one when you apply your calculator to the long-run fiscal challenge
posed by entitlement programs. Were I not a taciturn central banker, I would say the mathematics of the long-term outlook for entitlements, left unchanged, is nothing short of catastrophic. Fisher Storms on the Horizon Part 4 of 18
Today, our fellow citizens and financial markets are paying the DoublingStocks price for falling victim to the complacency and recklessness Martin warned against. Few scanned the horizon for trouble brewing as we proceeded along a path of unparalleled prosperity fueled by an unsustainable housing bubble and unbridled credit markets. Armchair or Monday morning quarterbacks will long debate whether the Fed could have/should have/would have taken away the punchbowl that lubricated that blowout party. I have given my opinion on that matter elsewhere and wont go near that subject tonight. What counts now is what we have done more recently and where we go from here. Whatever the sins of omission or commission committed by our predecessors, the Bernanke FOMCs objective is to use a new set of tools to calm the tempest in the credit markets to get them back to functioning in a more orderly fashion. We trust that the various term credit facilities we have recently introduced are 10 Minute Forex Wealth Builder! helping restore confidence while the credit markets undertake self-corrective initiatives and lawmakers consider new regulatory schemes. Accentuate The Positive
Last update : November 30, 2008 04:42 PM
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