The U.S. budget deficit totaled a record $738 billion during the first four months of the federal government’s current fiscal year, an 89-percent rise against the same period a year earlier, the U.S. Treasury Department reported.
Revenues reached $1.2 trillion for the period, also a record, while expenses soared 23 percent to a never-before-seen four-month total of $1.9 trillion.
For the 12 months ending 31 January, the deficit was $3.47 trillion, about 16.2 percent of GDP. In contrast, the deficit during the Great Recession peaked at 9.8 percent of GDP, according to the U.S. Treasury Department.
Revenue for the 12 months was 2.8 percent lower than the previous year.
The record budget gap was created by federal stimulus spending to keep the economy functioning during 2020’s lingering global economic shutdown and its aftermath.
Treasury secretary Janet Yellin and Jerome Powell, chair of the U.S. Federal Reserve, are among officials calling for additional deficit spending to bolster a still-feeble economy, saying that the danger of spending too little outweighs that of spending too much.
TREND FORECAST: What we are witnessing is unprecedented in peace-time history. Never before have nations sunk so deep in debt to artificially pump up markets.
What does it mean? What’s next? Read all about it in Gregory Mannarino’s new article, “WORLD CENTRAL BANKS: RUNNING A MASSIVE PONZI SCHEME.”
TRENDPOST: As we continue to note, there is no relationship between Wall Street and Main Street. As equities hit new highs and the rich get richer, the sentiment among the average Joe and Jane is dismal. The University of Michigan’s consumer sentiment index slipped from 79 in January to 76.2 in February, the university reported, compared to 101 in February 2020.
The outlook was mostly glum among households earning less than $75,000. The survey’s rating was the lowest since August when there were glimmering hopes for an economic revival.
