Alan Longbon — Good News: The U.S. Government Runs A $100B Deficit In October 2018, The Private Sector Runs A $100B Surplus

Summary

• The US budget deficit is $100 billion in October 2018; this is a net expansion of income and savings in the private sector and explains the rebound in markets.
• The good news is that dollars are being added to the economy by the Federal government, allowing the private sector to post a $100 billion surplus.
• Private credit growth has rebounded this month and made a $17B contribution to aggregate demand and fiscal flows.

Republican president and Republican Congress. Bring on the stimulus (denied Obama)! "Reagan proved that deficits don't matter.…" — Dick Cheney (2004)

Fed reaction response: Raise interest rates (without realizing that the addded interest payments are also stimulative and higher interest is a price rise).

Seeking Alpha
Good News: The U.S. Government Runs A $100B Deficit In October 2018, The Private Sector Runs A $100B Surplus

Alan Longbon 

Economy Watch — U.S. Budget Deficit Falls on Higher Tax Revenue

The U.S. government’s budget deficit shrank to its lowest amount in 8 years, thanks mostly to a record amount of tax revenue. Total tax receipts rose 7.6% while outgoings rose 5.2%, causing the deficit to fall to its lowest amount since the global financial crisis. The current deficit has fallen to $438.9 billion for the 2015 fiscal year, a 9.2% decline from the prior year.

The Treasury Department said “a stronger economy” helped cause tax receipts to rise, with more economic activity, and thus more taxes paid, occurring throughout the country. Total individual income tax collections rose to $162 billion, accounting for 44.4% of the U.S. government’s total receipts. Corporate taxes, at $75 billion, were just 46% of what was collected from individuals, and accounted for just 20.5% of total receipts.…

Economy Watch
U.S. Budget Deficit Falls on Higher Tax Revenue