hahahahahaha!!! Oh no! Deficit too small!!
EVERYBODY got this WRONG and I mean EV-ER-EE-BOD-EEE....
U.S. government posts $49 billion surplus in January https://t.co/nw8Ic0KlPW pic.twitter.com/9nYd2l8zpZ— Reuters Top News (@Reuters) February 12, 2018
25 comments:
And the economy is growing at 5.0%.
Where is the mea culpa from the MMT founders?
It's the flows, stupid. As we have been pointing out.
Now c'mon Mike, "do you believe those numbers?!".... LOL!!!
I think probably half of the deficit prior to Jan 1 was due to offshore tax avoidance schemes by the US based multi-nationals... Trump blew that all up.... I'm gonna have to reduce my previous estimate of population of the POS foreign USD zombie hoards by half...
Surge in imports in December was channel stuffing as those profits booked prior to Jan 1 are taxed at 15.5% and any after Jan 1 are taxed at 21% so a 5.5% savings to jam it in before Jan 1... ie Calculus III: "0.055 x a $bazillion = a $bazillion"
Does that mean that Trump will now have money left over to pay for his wall?
Btw, from the same Reuters twitter feed:
Reuters Top News @Reuters 46 minutes ago
Trump proposes a budget that calls for cuts in domestic spending and Medicare, seeks a sharp increase in military spending and funding for a wall on the Mexican border http://reut.rs/2Ga9F0s @jamesoliphant @gingergibson
Maybe he's going to balance the budget ....
#winning!
Matt, it's hard to follow this administration. Here's Mulvaney,
U.S. Budget Director Warns Interest Rates May ‘Spike’ on Deficit
I mean, what the heck!
https://www.bloomberg.com/news/articles/2018-02-11/u-s-budget-director-warns-interest-rates-may-spike-on-deficit
In the article: "The deficit for the fiscal year to date was $176 billion, compared to a deficit of $159 billion in the comparable period for fiscal 2017."
Matt and Mike have been saying this for years, have been proven right, over and over yet Mosler and Kelton and fam pretend they can't hear.
Greek, Tom has (imo correctly) labeled the Trump admin as an enigma... this is just the way he rolls.. he rufuses to be pinned down.. .imo plan accordingly..
First of all, balancing the budget is BS. When you can print whatever money you need there is no such thing as a budget.
Second, taxes are about distribution of wealth. Tax policy now is directly focused on facilitating the massive accumulation of wealth as opposed to more equal distribution (in terms of government spending on society including infrastructure and social programs).
So what we have is phony system set up to enrich a few who (no surprise) control the system and use it to benefit themselves at the expense of everyone else.
Arguing about the particulars of the phony system just buys into it.
“balancing the budget is BS”
Yes but THEY don’t know that...
“Arguing about the particulars of the phony system just buys into it.”
Seeking to provide a correct technical explanation about how a particular system is operating (good or bad) is not arguing about anything ... it’s not politics ... it’s proper technocracy ...
"Matt and Mike have been saying this for years, have been proven right, over and over yet Mosler and Kelton and fam pretend they can't hear. "
They're all saying the same thing from where I'm standing - just describing it differently for the different audiences they are speaking to.
It's always been about the spending flow and that tends towards a larger deficit over time as people net save in the currency of issue.
It's the same elephant that is being described. Always has been.
I wonder how many monthly budget surpluses preceded the 2001 recession.
Neil nobody predicted this surplus we got in January... all the predictions were for big deficits...
Not singling anyone out... singling EVERYBODY out.... NOBODY knows wtf is going on.... SCARY!!!!!!!
It's the same elephant that is being described. Always has been.
The MMT economists are concerned chiefly with:
1. Accommodating non-government saving desire since private debt financing is unsustainable over time unless incomes keep pace.
2. Using fiscal space to achieve and maintain optimal output given available resources with moderate inflation, which implies running "true" full employment by government providing funding for a buffers tock of employed instead of defining "full employment" to accommodate a chronic buffer stock of unemployed as under monetary policy guided by NAIRU and inflation targeting.
$49 billion leaving the world economy, entering the US economy, and not being spent into the economy - since majority of it will go to the rich as tax cuts and saved. So net net, a negative for 2018 economy - just my 2c.
Smoke and mirrors.
Economic numbers are routinely skewed for political effect and commonly revised months later. Additionally some real-time numbers are either one-shot (like taxes on earnings held overseas) or negative (like payroll taxes down 15b per month).
Can someone explain what exactly Matt and Mike have been saying that is different than what Mosler, Kelton, etc. have been saying?
An elaboration of "It's the flows, stupid" please!
No afraid not... we were in surplus in January...
Currently $70B deficit for February (thru 12th) ... headed to a even larger deficit this month...
Social Security Weds, maybe $50B interest payment Thursday and then IRS Tax Refunds via Direct Deposit again on Friday.... in additions to normal amounts...
SDB, MMT elites use the typical Modified Accrual Basis fed govt accounting method and look at the govt "deficit" results to gauge fed govt activity... iow if the "deficit" is large, then they interpret that as higher govt engagement...
Mike and I have been rather using Cash Basis and look at the individual withdrawals and deposits of the Treasury and gauge govt involvement via the actual Cash Basis withdrawals from the Treasury account where a higher rate of withdrawals would be the primary indicator of increased govt engagement...
so you could see the deficit fall via Modified Accrual, MMT would say "deficit too small!", but the Cash Basis rate of Treasury withdrawals could be in fact increasing along with deposits and the "deficit" could be decreasing... even into "surplus" over short time intervals...
So this year iirc Mike has Cash Basis withdrawals now UP over 3% YoY so we continue to see tepid growth...
Matt Franko,
Thanks for the elaboration!
Can each of those two data streams be found somewhere? (the Modified Accrual Basis numbers vs. the Cash Basis numbers)
Or are you developing either through calculation?
I'd like to get a look at the numbers and doing some analyzing.
The Cash Basis is what is used in the Daily Treasury Statement which is here:
https://www.fms.treas.gov/dts/index.html
Or here
http://treasury.io/
The Accrual is used in the Monthly Treasury Statement which is not timely as well as hard to interpret as nobody else uses it other than the federal govt ... it’s more or less Cash Basis on the left and Accrual on the right .... I can never make any sense out of it fwiw...
Thanks for the leads Matt!
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