Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: macavity who wrote (5157)	11/29/2001 12:40:42 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

Nice PDF you posted. The US Budget surplus is gone already Federal budget deficits are back Red ink expected for at least the next three years ASSOCIATED PRESS WASHINGTON, Nov. 28 — The recession and the costs of war and battling terrorism have made annual federal deficits likely for at least the next three years, the White House budget director said Wednesday. THE PREDICTION by budget chief Mitchell Daniels was one of the gloomiest assessments yet of the government’s fiscal health. And it was the first time an administration official has publicly acknowledged that deficits — banished since surpluses first appeared in 1998 — are likely now for several years. “It is regrettably my conclusion that we are unlikely to return to balance in the federal accounts before possibly fiscal ’05,” Daniels said in a speech at the National Press Club. He added, “Things will have to break right for us to do that.” Daniels’ comments further underlined what has been a turnaround in the government’s budget picture of unprecedented abruptness. SURPLUS SHRINKS, VANISHES The record $237 billion surplus of fiscal 2000 shrank to a $127 billion surplus in fiscal 2001, which ended on Oct. 1. Though Daniels provided no figures, private analysts and many congressional aides have long expected a 2002 deficit that will be well into the tens of billions of dollars. Until several months ago, most forecasters were envisioning an ever-growing string of budget surpluses for the next decade, fading as the huge baby boom generation begins to retire. Last spring, official surplus projections for the coming decade totaled $5.6 trillion. But then the recession — now officially pegged as having started last March — took hold, and the condition of the government’s books began to weaken. In addition, President Bush pushed a $1.35 trillion, 10-year tax cut through Congress, further eroding the projected black ink. Another severe blow was dealt by the Sept. 11 terrorist attacks, which staggered the economy and triggered tens of billions in spending for anti-terrorism, the war in Afghanistan and economic recovery. Daniels acknowledged that as a result, the administration would lower its long-term growth estimates, which means the government would expect to collect less revenue than it would with stronger growth. WHITE HOUSE TO PUSH SPENDING CUTS “This has profound effects, when compounded out over time, on the amount of money that we can expect to have available in the federal treasury,” Daniels said. To try to force a return to surpluses, Daniels said the administration would propose a fiscal 2003 budget early next year that is generous toward defense, anti-terrorism and other high-priority programs, but seeks to trim other programs that seem less necessary. He cited the National Science Foundation and food aid for women, infants and children as important and effective programs. He said the government has too many job-training programs and seemed to suggest that border protection programs could be made more efficient. PAYMENT OF BENEFITS COULD CHANGE He also said the budget would propose taking some automatically paid benefits and changing their status so they must be approved annually by Congress or the money would not be spent. Daniels provided no examples, but such a proposal would be likely to face tough going from lawmakers eager to protect constituencies who currently received such aid. Two-thirds of the $2 trillion annual federal budget — including Social Security, Medicare, Medicaid, welfare, farm aid — are currently for programs in which benefits are paid automatically, without annual congressional approval. Daniels said the budget choices the administration and Congress make in the upcoming budget will be a test of whether they can “govern as adults should in a time of crisis and urgency.” Those decisions, he said, will be crucial. “The budget that we will be submitting just a couple months from now will determine whether we ever see another surplus,” he said.

To: macavity who wrote (5157)	12/6/2001 2:27:04 AM
From: Jon Koplik	Respond to of 33421

Re : laughing at the U.S. gov't for (purportedly) doing things wrong with U.S. Treasury borrowing / debt management decisions -- Just want to remind you -- way back when Ross Perot was running for President (the first time, I believe) there was a HUGE amount of discussion on how stupid and dangerous it was for the U.S. Treasury to be shortening the average maturity of U.S. Treasury debt (by holding more auctions at the short end of the yield curve). It was criticized as short-sighted, foolhardy, reckless, etc. It turned out to be brilliant and correct. Taxpayers have saved a fortune because the Treasury dared to defy the "experts." Jon.