Steve_A
02-11-2009, 07:39 PM
Hi Everybody,
It's already starting to come out....
http://www.bloomberg.com/apps/news?pid=20601087&sid=atwQ4pUtn6Y0&refer=home
By Vincent Del Giudice
Feb. 11 (Bloomberg) -- The U.S. budget deficit widened more than economists forecast last month as spending soared and corporate tax receipts shrank, putting the Treasury on course for a record annual shortfall of more than $1 trillion.
The excess of spending over revenue in January rose to $83.8 billion, compared with a $17.8 billion surplus in the same month a year earlier. Spending gained 30.6 percent, while revenue dropped 11.4 percent. Corporate tax revenue in the past four months is down 44.3 percent from a year earlier.
The deficit four months into the 2009 fiscal year already is higher than the record for all of the previous year. A recession now in its second year, rising foreclosures and 13 straight months of job losses are cutting tax receipts. At the same time, the government is pledging hundreds of billions of dollars of taxpayer funds to arrest the financial crisis.
“We’re experiencing a terribly challenging fiscal environment and a terribly challenging economic and financial crisis,” Treasury Secretary Timothy Geithner said earlier today in testimony to the Senate Budget Committee.
January is typically a surplus month because quarterly taxes are due. Before today’s report, economists in a Bloomberg News survey forecast a January deficit of $78 billion. The non- partisan Congressional Budget Office issued a similar projection for January.
Stimulus Plan
Democratic House and Senate leaders are near agreement on a $789.5 billion economic stimulus plan, a leadership aide said today. The tentative dollar amount, reached after late-night talks, is smaller than the $838 billion bill approved by the Senate yesterday and the $819 billion package passed by the House last month.
“The White House believes we are making good progress toward an agreement on a plan to put Americans back to work,” administration spokesman Robert Gibbs said.
During the first four months of fiscal 2009, which began Oct. 1, the country’s deficit swelled to a record $569 billion for the period, compared with an $89 billion shortfall during the same period a year earlier.
The deficit in 2008 totaled a record $454.8 billion, and the CBO is projecting a shortfall of at least $1.2 trillion during this fiscal year -- or more than 8 percent of economic output, according to the CBO’s Web site.
“Obviously a trillion-dollar deficit would not be a good thing in a healthy economy but in a severe recession it helps pick up the slack from private spending that’s been contracting,” said Gary Thayer, senior economist at Wachovia Securities in St. Louis, before the report.
Deepening Recession
The government’s latest reading on the labor market suggests the economic contraction is deepening. The economy lost 598,000 jobs in January and the unemployment rate increased to 5.7 percent -- the highest since 1992. What’s more, gross domestic product declined by 3.8 percent in the final three months last year, the sharpest contraction since 1982.
In other categories, spending by the Social Security Administration rose 8.2 percent to $230.278 billion for the fiscal year to date; spending by the Department of Health and Services, which administers the Medicare and Medicaid health programs, rose 15.1 percent to $257.997 billion and spending by the Defense Department rose 9.2 percent to $219.198 billion.
Geithner said in testimony yesterday to the Senate Banking Committee that the Obama administration is mindful of the fiscal challenges. “The president’s budget will lay out a path to bring that deficit down over time to a level that is sustainable and has us living within our means again,” he said.
Best regards,
Steve
It's already starting to come out....
http://www.bloomberg.com/apps/news?pid=20601087&sid=atwQ4pUtn6Y0&refer=home
By Vincent Del Giudice
Feb. 11 (Bloomberg) -- The U.S. budget deficit widened more than economists forecast last month as spending soared and corporate tax receipts shrank, putting the Treasury on course for a record annual shortfall of more than $1 trillion.
The excess of spending over revenue in January rose to $83.8 billion, compared with a $17.8 billion surplus in the same month a year earlier. Spending gained 30.6 percent, while revenue dropped 11.4 percent. Corporate tax revenue in the past four months is down 44.3 percent from a year earlier.
The deficit four months into the 2009 fiscal year already is higher than the record for all of the previous year. A recession now in its second year, rising foreclosures and 13 straight months of job losses are cutting tax receipts. At the same time, the government is pledging hundreds of billions of dollars of taxpayer funds to arrest the financial crisis.
“We’re experiencing a terribly challenging fiscal environment and a terribly challenging economic and financial crisis,” Treasury Secretary Timothy Geithner said earlier today in testimony to the Senate Budget Committee.
January is typically a surplus month because quarterly taxes are due. Before today’s report, economists in a Bloomberg News survey forecast a January deficit of $78 billion. The non- partisan Congressional Budget Office issued a similar projection for January.
Stimulus Plan
Democratic House and Senate leaders are near agreement on a $789.5 billion economic stimulus plan, a leadership aide said today. The tentative dollar amount, reached after late-night talks, is smaller than the $838 billion bill approved by the Senate yesterday and the $819 billion package passed by the House last month.
“The White House believes we are making good progress toward an agreement on a plan to put Americans back to work,” administration spokesman Robert Gibbs said.
During the first four months of fiscal 2009, which began Oct. 1, the country’s deficit swelled to a record $569 billion for the period, compared with an $89 billion shortfall during the same period a year earlier.
The deficit in 2008 totaled a record $454.8 billion, and the CBO is projecting a shortfall of at least $1.2 trillion during this fiscal year -- or more than 8 percent of economic output, according to the CBO’s Web site.
“Obviously a trillion-dollar deficit would not be a good thing in a healthy economy but in a severe recession it helps pick up the slack from private spending that’s been contracting,” said Gary Thayer, senior economist at Wachovia Securities in St. Louis, before the report.
Deepening Recession
The government’s latest reading on the labor market suggests the economic contraction is deepening. The economy lost 598,000 jobs in January and the unemployment rate increased to 5.7 percent -- the highest since 1992. What’s more, gross domestic product declined by 3.8 percent in the final three months last year, the sharpest contraction since 1982.
In other categories, spending by the Social Security Administration rose 8.2 percent to $230.278 billion for the fiscal year to date; spending by the Department of Health and Services, which administers the Medicare and Medicaid health programs, rose 15.1 percent to $257.997 billion and spending by the Defense Department rose 9.2 percent to $219.198 billion.
Geithner said in testimony yesterday to the Senate Banking Committee that the Obama administration is mindful of the fiscal challenges. “The president’s budget will lay out a path to bring that deficit down over time to a level that is sustainable and has us living within our means again,” he said.
Best regards,
Steve