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Diversity is not our strength - UNITY is. - Michelle Malkin

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 |  All Boards  |  Current Events  |  Topic: Powell says he is 'very worried' about growing amount of U.S. debt 0 Members and 1 Guest are viewing this topic.
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Author Topic: Powell says he is 'very worried' about growing amount of U.S. debt  (Read 22 times)
wvit1001
Sr. Member

Posts: I am a geek!!


« on: 01 10, 19, 07:44:12:PM » Reply

"I'm very worried about it," Fed Chairman Powell said Thursday. "It's a long-run issue that we definitely need to face, and ultimately, will have no choice but to face."

Total U.S. debt is about $21.9 trillion, of which $16 trillion is owed by the public. The sustained annual U.S. deficit is now believed to be more than $1 trillion.

In part because of continued rate increases under Powell, the interest cost on that debt could start to become a bigger and bigger burden.

"From the Fed's standpoint, we're really looking at a business cycle length: that's our frame of reference. The long-run fiscal, nonsustainability of the U.S. federal government isn't really something that plays into the medium term that is relevant for our policy decisions."

However, "it's a long-run issue that we definitely need to face, and ultimately, will have no choice but to face," he added.

The Fed chief's comments came as the annual U.S. deficit reaches new sustained highs above $1 trillion, a fact many economists worry could spell trouble for future generations. Annual deficits have topped $1 trillion before, but never during a time of sustained economic growth like now, raising concern about what would happen if a recession hits.

Wall Street's "bond king" and respected financial prognosticator Jeffrey Gundlach said in December that the Fed seems to be on a "suicide mission," raising rates while the government deficit increases as a share of GDP. Normally when the deficit is expanding, the Fed would be lowering interest rates.

Fitch Ratings — one of the top credit rating agencies that analyzes companies and governments alike — said Wednesday that the ongoing government shutdown could soon start to impact its ability to pass a budget and could impact the government's triple-A sovereign score.



https://www.cnbc.com/2019/01/10/fed-chairman-powell-says-he-is-very-worried-about-growing-amount-of-us-debt.html
Jw2
Sr. Member

Posts: 37051


« Reply #1 on: 01 11, 19, 04:14:23:PM » Reply

The latest Trump/Republican tax cut for the rich is prime example that right wingers aren't really (fiscal) conservatives.
Dan
Contributor
Sr. Member

Posts: 82726

Tolerance is a 2-way street


« Reply #2 on: 01 12, 19, 08:30:38:PM » Reply

Actually, since tax cuts for the rich actually generate MORE revenue to the treasury, they are absolutely fiscally responsible.  I just with they would increase taxes on the bottom 90% who are not paying their faire share.
wvit1001
Sr. Member

Posts: I am a geek!!


« Reply #3 on: 01 12, 19, 08:34:32:PM » Reply

No, Trump’s Tax Cut Isn’t Paying for Itself (at Least Not Yet)

Federal revenues rose slightly in the 2018 fiscal year. But that doesn’t mean the $1.5 trillion tax cut is bringing in more revenue than it’s losing.

The Treasury Department released figures on Monday showing the federal budget deficit widened by 17 percent in the 2018 fiscal year, to $779 billion. That’s an unusual jump for a year in which unemployment hit a five-decade low and the economy experienced a significant economic expansion. But the increase demonstrates that the tax cuts President Trump signed into law late last year have reduced federal revenues considerably, even against the backdrop of a booming economy.



https://www.nytimes.com/2018/10/17/business/trump-tax-cuts-revenue.html
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