There is a landmine buried in today’s 2Q GDP report, and Congress is about to step on it while engaging in its debt-ceiling pissing match.
The raw numbers are ugly. The federal budget deficit is nearly 40% of total spending; that is, for every $1,000 the government spends, it collects $600 in taxes and borrows $400. Doesn’t anyone do any math in Washington?
…is falling off a cliff again, hitting ¥78 and €0.69. You can sit idly by and watch it get demolished, or you can do something about it.
What galls me the most in this entire imbroglio of our debt ceiling is the hypocritical approach of our politicians: A Congress that authorizes every dollar that gets spent, gleefully accumulating a pile of debt so vast it’s hard to wrap your brains around it; and administrations who have been eager to borrow and spend as directed by Congress.
The worldwide night of the living debt continues with Greece, Italy, and the US. And so I mention them, nasty as I am, in the same breath with Japan.
While Democrats and Republicans, jointly and severally, engage in an all-out pissing match over the national debt ceiling and the budget deficit that even has the Chinese worried, let’s take a moment and reflect from a safe distance on how we got here, and why nothing of significance is going to change.