How about NEGATIVE corporate income tax receipts? Huh, how does that happen?
Got your attention? It should, because our entire financial system is in ruins, despite the daily manipulated data you receive. Please pay attention to the numbers buried in this report and keep in mind that it’s very difficult to manipulate the amount of tax money received. It’s easy to manipulate GDP and also things like retail sales where stores that go out of business are no longer counted. Look at the REAL data in the REAL economy and there is no real good to be found. Don’t shoot the messenger, I am going to offer solutions, REAL solutions.
U.S. Oct. Budget Deficit Rises to $176.4 Billion, Revenue Falls
By Vincent Del Giudice
Nov. 12 (Bloomberg) -- The U.S. budget deficit widened in October from a year earlier, reaching a record for that month, as rising unemployment cut revenue at the start of the first full fiscal year under President Barack Obama.
The excess of spending over revenue widened to $176.4 billion last month, compared with a deficit of $155.5 billion in the same month a year earlier, the Treasury Department announced today in Washington in its monthly budget statement. It was a record 13th consecutive shortfall and the fifth-largest monthly gap on record, the department said.
Unemployment in the U.S. at a 26-year high of 10.2 percent in October and spending from the $787 billion economic stimulus plan are straining the Treasury’s finances. The government is headed for a second straight year of a deficit exceeding $1 trillion.
“Tax revenue is down, incomes are down, profits are down and there are not many capital gains to tax out there,” David Wyss, chief economist at Standard & Poor’s in New York, said before the report. “On top of everything else going wrong, you’ve got the baby boomers just hitting retirement age, so there’s going be an increase in entitlement programs,” such as Social Security and Medicare, he said.
Economists surveyed by Bloomberg News forecast a deficit of $165 billion in October, according to the median of 29 estimates. Projections ranged from deficits of $125 billion to $199.4 billion. The non-partisan Congressional Budget Office predicted a shortfall of $175 billion for the month.
Officials have estimated that the country’s legal limit on debt of $12.1 trillion may be reached in December. During the fiscal year that ended Sept. 30, the Treasury reported a record deficit of $1.4 trillion.
Spending for October declined 2.7 percent from the same month a year earlier to $331.7 billion, and revenue and other income fell 17.9 percent to $135.3 billion, according to the Treasury’s budget data.
Individual income tax collections fell 29 percent to $61.2 billion in October from a year earlier, and corporate tax receipts last month were a negative $4.5 billion on the government’s books, the statistics showed.
In other categories, spending by the Social Security Administration rose to $65.2 billion last month from $59.2 billion; spending by the Department of Health and Human Services, which administers the Medicare and Medicaid health programs, rose to $85.9 billion from $76.5 billion and spending by the Defense Department rose to $67.8 billion from $66.1 billion, according to the data.
The Treasury also spent $175 million last month on the financial rescue plan called the Troubled Asset Relief Program compared with $33.4 billion a year earlier, the budget statement showed.
Wyss is forecasting a $1.4 trillion shortfall for fiscal 2010, which started Oct. 1, matching the deficit the CBO predicted in August.
The economy probably will grow 2 percent next year, and “that’s just enough to hold things steady” for the government’s fiscal situation, Wyss said. Any improvement in the budget deficit will bring the total to a level “that would have been a record before last year,” he said.
Over the past week, the Treasury auctioned a record $81 billion in its quarterly sales of long-term debt. The Treasury’s debt-management director, Karthik Ramanathan, told a meeting of bond market participants last week to anticipate another year of government debt sales of $1.5 trillion to $2 trillion, according to minutes of the session released on Nov.4.
All receipts DOWN, corporate receipts negative, and at the same time all categories of spending up!
And today’s 30 year bond auction had a bid to cover of only 2.27. A healthy auction is 3 or higher. But that’s all just a game, the Primary Dealers (private banks) are required to buy. Those banks comprise the “Fed,” they are who the Fed is. It is a circle jerk without end, that is until people figure out their game and lose confidence in their ability to keep it going.
Oh yeah, sure, “the economy probably will grow at 2 percent next year.” What bullshit! Do you buy it? I don’t. Did you know that 2% growth per year will kill a currency dead in less than a century? Is that a stable system? Or is it a system designed to rise up and be skimmed along the way, only to be taken down and done again, and again?
Let’s look at the real economy, shall we? Below is the chart I showed earlier from the Association for Manufacturing Technology (AMT) and The American Machine Tool Distributors’ Association (AMTDA) showing machine and machine tool consumption:
That’s a 75% decline and is nowhere near back to previous levels.
Here’s today’s chart showing the current Baltic Dry Shipping Index (BDI). While the bounce appears large when calculated off a nothing bottom, the collapse was the result of an exponential rise. The collapse is historic in nature, it has not and will not return to previous levels any time soon.
Numbers are a funny game, the human mind has trouble processing percentage and exponential moves. Those who know how, play games with those numbers. These raw data charts do not lie, and the raw data tax receipts do not lie either.
It’s time for real and meaningful change. It’s time for the truth to rise to the surface. There is no bullish case or bearish case. The issues are not just what this Democrat says or that Republican says – they are both backed by the same purveyors of debt backed, fractional money. The issue of money is likewise boxed in by the same purveyors on one side and the gold bugs on the other. Guess what? The bankers don’t really care what backs the money, they are going to profit, control, and manipulate them either way. It’s time to put the money function back in the people’s hands where it rightly belongs, THE one purpose of government that is most appropriate.
David Bowie – Rebel: