US Deficit up 33.8% in 2016 vs 2015

Here is something for Bob Brinker to talk about this weekend.

Between fiscal 2015 and fiscal 2016

• Collections by the US Treasury grew by 0.6% to $3.27 trillion
• Spending by the US Government grew by 4.5% to $3.85 trillion
• The US budget deficit grew by 33.8% or $587 billion 

As long as I can remember, Brinker has said our government "spends like drunken sailors" which many think is an insult to sailors, sober or otherwise.

Here is my breakdown of the data in table form to add numbers they don't like us to know.

You can check my numbers here at the Treasuries "Final Monthly Treasury Statement"

• https://www.fiscal.treasury.gov/fsreports/rpt/mthTreasStmt/mts0916.pdf

This table adds a calculation for the monthly, rather than YTD change.

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Will US Pay Off National Debt? Budget Deficit & Bob Brinker's GDP Estimate

Bob Brinker's comments "Will the US ever Pay Off Its National Debt?" 

Moneytalk with Bob Brinker Commentary for October 28, 2012 Radio Show

The following commentary is from my "Retirement Advisor" writing partner,  David Korn. 

Brinker Comment: Bob opened the broadcast discussing the new figures on gross domestic product. Bob said his projection has been for a slow-growth economy as defined by a slow rate of growth in real GDP (adjusted for inflation) and we continue to see that with the number for the third quarter coming in at 2.0%. When you couple that number with the first half of the year, you are looking at an annual rate of growth of 1.8% for the first 9 months which is the type of slow growth that Bob thinks we will see for the remainder of the year. 

DEBTS AND DEFICITS

Caller: At some point, the Federal Government will start to have to pay off the national debt. The caller said he thinks it seems like an unsustainable situation that will either be addressed by cutting spending or raising taxes. Or the government could start printing more money which could lead to inflation or hyper-inflation. How likely is it that we would see inflation or hyper-inflation and is there anything the average investor can do to hedge against this possibility?

"Witnessing the Republicans and the Democrats bicker over the U.S. debt is like watching two drunks argue over a bar bill on the Titanic."   Kirk Lindstrom

 Bob said there are essentially no cases in the history of the world where the country has paid off its national debt and we will probably never even make a serious down payment on paying off the $16 trillion national debt. We will pay the interest on the national debt as long as we can afford to do so. As far as the national deficit, that is in play and must be addressed and that is a big deal. Hopefully, Congress will get to work on the annual deficits which at the current pace is not sustainable.

EC (David Korn): Our $16 trillion dollar national debt amounts to $51,484 for every man, woman and child in our country. Check out this interesting article entitled, “Breaking down the national debt” at the following url: http://tinyurl.com/8p9vy5u

Kirk's Comment:  I don't think enough attention goes to just how large the deficit is and how much borrowing occurs for every dollar spent.  I like how Bob Brinker has warned about excessive spending for years and I'm doing my part to spread the word.  Read my Seeking Alpha article:

 U.S. Borrowed 31 Cents Of Each $1 Spent In Fiscal 2012:
Final Deficit Is $1.1 Trillion

Kirk's Comment:  Can you imagine asking anyone for a loan, home equity or a refinance of a home loan, if you knew you would never pay it back?

The above commentary is courtesy of my writing partner, David Korn: 

David Korn's Stock Market Commentary, Interpretation of Moneytalk (Bob Brinker Host), Financial Education, Helpful Links, Guest Editorials, and Special Alert E-Mail Service.  Copyright David Korn, L.L.C. 2012

More from David Korn:

• June 10: Review of Bob Brinker's Five (5) Root Causes of a Bear Market

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Bob Brinker on Buffett Rule and Deficit Spending

One thing I really like about Bob Brinker is that for many years he has been highly critical of US Government spending. Brinker said this weekend that our government has been exploding under both parties.  Brinker used to say the government spent like "drunken sailors." I believe he stopped when someone on one of the forums I moderated pointed out this was an insult to drunk sailors since they ONLY spend all the money they have in their pockets when on liberty. The US, compared to drunk sailors on liberty, spend MORE than they have!

Current Deficit:  How many are aware that the total budget deficit for the first six months of fiscal 2012 reached $778,988 billion? In March 2012, the U.S. Government ran a budget deficit $198B, the Treasury Department reported. This is up $10.0 billion or 5.3% from the $188.154 billion deficit in March 2011.

This weekend Brinker said the "Buffett Rule" proposed by President Obama is a populist measure aimed at winning votes during an election year.  He says it would have marginal value in balancing the budget because it doesn't raise much money compared to the huge deficit.  Brinker said he is not worried the wealthy will leave the country if the Buffett Rule passes. 

Kirk's Comment: This doesn't surprise me.  Brinker can sound fairly liberal at times unless it means his own taxes will go up.  The point of the Buffett Rule is one of fairness.  Most of us pay Payroll Taxes which are not invested but spent just like Income Taxes.  The wealthy usually pay a much smaller percentage of total income to total federal taxes when you include the payroll tax in the equation.  What bugs me is I heard the president claim he was going to raise the taxes on himself with his new proposal, but he didn't make one Million so his taxes will stay the same under his rule.  My own taxes are far higher than his so I think he's still being unfair and is thus, full of hot air and not completely honest. 

Read the full article: U.S. Borrows 53.7 Cents Of Every Dollar Spent In March

Brinker pointed out that the Obama Administration wants taxes to go up on singles making over $200,000 and couples making over $250,000 without raising taxes on those making less. A caller pointed out that Obama could go after these middle income people after they get higher taxes on the rich.  Bob said the House of Representatives would never pass this sort of tax increase and the Senate could not get sixty votes.

Kirk's Comment: The trouble I see it is they can't or won't work together so those who want higher taxes will get it by default in 2013.  I think this is a big reason the market has such a low PE while interest rates are also very low.

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