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CBO Says Its Own Budget Estimate May "Significantly Underestimate" Short-Term Deficit Outlook
Those who were disappointed by the earlier CBO budget reestimate which increased total deficit by about $44 billion over the next two years, will have to weep more tears based on the just released statement by Congressional Budget Office director Doug
Elmendorf who said that in reality the budget deficit could come much higher than the just disclosed estimates, and the recent economic data releases have been "more negative" than data factored into the projection. Which, in government talk, means that the real deficit will likely come at least 20-30% higher, and since debt issuance tends to track around 40% higher than nominal deficits, the bottom line is that the US will have to issue a gross $3 trillion+ over the next two years. But who cares: one could add 10 zeroes to this number, and rates would likely drop to zero overnight.
Back to Elmendorf and this rare moment of truthiness, via Market News:
Congressional Budget Office director Doug Elmendorf said Thursday that his agency's new fiscal report may "significantly underestimate" the nation's short-term deficit outlook because of the requirements of budget estimating.
At a briefing following the release of the CBO's mid-year budget and economic outlook, Elmendorf emphasized that under budget law the CBO must make its baseline estimates by assuming that current tax and spending laws are unchanged.
He added the U.S. fiscal outlook would be "quite different" if other, arguably more plausible, assumptions were made.
Elmendorf said the U.S.'s long-term fiscal outlook is "daunting," adding that even using optimistic scenarios the U.S. level of public debt will hit 70% of GDP by 2020.
"This is an extraordinarily high level of debt" when viewed in the context of American history, he said.
Elemendorf said the CBO sees growth in the U.S. economy as "continuing at a modest pace." The recovery so far has been "anemic," compared to other American recoveries after deep recessions, he said.
Elmendorf said recent economic indicators since CBO completed its economic estimates have been "more negative" than it expected, but he added that the new reports would not have changed CBO's overall economic estimates significantly.
The CBO chief said that he expects interest rates in the U.S. to increase "as the recovery takes hold over time." He also said that large debt levels would put upward pressure on rates.
Elmendorf concluded his session of truthiness by saying the following thing so glaringly obvious, that nobody in the administration has figured it out yet:
Elmendorf said the CBO envisions a "slow decline" in the
unemployment rate over the next several years, but added that there is
now "great uncertainty" about the precise relationship between economic
growth and specific employment levels.
In other words the government is now sailing blind, without a rudder, and using untested navigation theories, through the biggest metaphorical hurricane this side of the pre-WWII years. This level of confidence will surely inspire Americans to reverse the trend of 15 sequential weekly outflows from domestic stock funds.
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The power of the world's printing press!
F*cked Bitchez!
Let me get this straight. We just released some numbers and BTW we used bad assumptions. We never saw this uncertainty coming!
It was "unusually uncertain" uncertainty.
Yes, now you have it.
But these guys, on the ball they are. Note that it was an anticipated unusually uncertain uncertainty because they were able to work up a press conference on the matter at the same time they issued the report with the uncertainty in the assumptions.
With this sort of legerdemain in evidence, I am more confident than ever that they will pull a rabbit from the hat. Or something. A mammal at least. Perhaps a small, vicious shrew.
+1
More to the point:
We are so screwed.
At least by using the headless chicken some randomness is entered into the calculations, thus assuring some objectivity. Of course, this is then quickly backed out so as not to disturb the preselected objectives flowing up from Congress and down from the WH.
Maybe they should try something bigger, like a Butterball Thanksgiving turkey. :>)
So worth watching again - "Bailout" 1:02 - http://www.southparkstudios.com/clips/222638/
The icing on the cake is the guy playing the kazoo.
A big thumbs up for the kazoo guy. :>)
I love Geek Speak. It's so......how do you say it........underwhelming.
CBO can hear the govt unbolting the kitchen sink and furniture to throw into the fire.
Obfuscation bitchez.
CBO sez we don't know, can't figure it out, but all is well.. Go Barry Go!
This is the usual "report the green and revise into the red" Kabuki theater we've been fisted off with for the last 24 months.
But I tell you what. Sudden bouts of uncharacteristic truthiness give me the heebie-jeebies. Make my skin crawl. These guys are inveterate liars. From kindergarten they've practiced artful dodging. So of a sudden they start getting all Bible on you and openly talking the truth, you better worry too. Because I'm here to tell you son they are worried.
A worried liar. A worried professional liar. You better start looking around wondering what's got them telling the truth. Because whatever it is, you want no part of it.
That's about the best decription I've heard yet.
bingo. reminds me of brian williams' "there's no more money".
cougar, you should start an ETF based on your skin readings.
ticker symbol : CYA
Actually what you're seeing is an accelerating second derivative of the truth. They always maintain a wide margin between "THE TRUTH" and what is released for public consumption. So when you feel they're getting closer to your truth, what's actually happening is "YOUR TRUTH" is getting further away from "THE TRUTH".
Time to reassess where you stand my favorite "wild thang". You've drifted away from the real reality. Time to power back up your gyroscopes and recheck your error correction calculations.
hee hee. Thought you could blow my mind today? Not after my third cup of coffee! Third derivatives are a cinch after 300mg of caffeine.
A story: A scientist was once arguing cosmology with an old woman who claimed that the earth was sitting on the back of a turtle, which also stood on a turtle, and their movements made the earth shake. The scientist quipped "then what do the turtles stand on?" to which the old woman reportedly replied, "Ah you think you are clever, but you see it is turtles all the way down."
I don't buy the idea that it's oligarchs all the way down. They aren't that smart. They are not gods. This is an illusion, mirrors reflecting other mirrors, and if you've seen that happen then you notice that the reflections repeat for infinity. But there is not an infinity of mirrors at all, only two mirrors and a setup such that the illusion of a complex infinity is nearly perfect.
I think the oligarchs are loosing control of the illusion. I sense it more than I see it. maybe it's a cat thing, sometimes you go with your instincts.
Or you may be right and they've got me chasing my own tail. Again. But if my read on total system entropy is anywhere near correct, then this 500 years running side show is over. And I don't mean over with season reruns either. Train wreck over.
funny you should mention the magic mirror maze.
this scene has been on me mind for the past couple weeks:
http://www.youtube.com/watch?v=tBOKjoxfP5Y
...from another director way ahead of his time...
Damn John Obama-booty and the donkey he rode in on.
The same CBO that underestimated the cost of health care by $115 billion? I'm shocked...SHOCKED I tell you.
Planet 10 is looking better and better.
whocouldnode?
It is all so "unexpected" and "inexplicable".
Uh, how about a range from several trillion to a quadtrillion dollar shortfall.
But don't hold us to it.
<sarc off>
Insanity is escalating. The king rats own puppets act as if they are jumpin ship. It must be a set up to pull the rug from under us, soon.
the point of no return is not that far..interest rates will not rise they will skyrocket...
It's very weird that so many prominent commentators and economists seem primarily concerned with how to keep the government going rather than on how to induce prosperity.
There's a certain strain among the intellectual classes that the state is the font of everything good in the world, and that it must be preserved no matter what.
the State is their bodyguard mate.
"the only thing separating you from the torches & pitchforks gentlemen is my administration", said Chief O-bully to the Head Shylocks.
fear's a bitch ain't it?.
It's like smelling smoke.. Leaving the building.. Standing outside.. Flames getting higher.. Screaming for the others to get out.. They come to their window, look at you like you are riff raff.. and close the window and curtain while shaking their head in disgust because the waste of time it was walking to the window to see what all the fuss is.
Budget? Why even bother with a f***ing budget at this point?
Just raise the debt ceiling to $1 quadrillion and print/borrow/spend like mad.
Wait.
Didn't the House decide _not_ to pass a budget this year?
CBO, the guys who blessed obamacare. remember how it was to reduce the deficit and lower healthcare premiums and costs? LOL whatta joke
[quote]
So far, the public has not been fooled by the claim that a new entitlement for 30 million people is being created -- and it will cost less.
But now the Democrats have the Congressional Budget Office's (CBO) official accounting -- and they plan to use it as a shield and a sword as they wade into the public debate.
Of course, every informed person understands why the CBO calculation is an honest measure of a dishonest bill. Republican Rep. Paul Ryan at the health care summit, former CBO Director Douglas Holtz-Eakin, in last Sunday's New York Times, and hundreds of commentators have all laid out the lamentable, indisputable and undisputed fact that the CBO methodology has been gamed by the congressional Democrats to turn what will be more than a trillion dollars in further public deficit and debt into a fantasy savings of $140 billion.
While Medicare is at about $30 trillion in unfunded liability by 2070, the bill
preposterously claims it is going to cut Medicare by half a trillion dollars a
decade. The quarter- to half-trillion dollars per 10 years that it will cost to
pay Medicare doctors enough to keep them providing services has simply been put
in another bill. The mendacities go on and on. They are not merely small,
politically useful little deceptions. They are of a dimension that may destroy
the republic.
[/quote]
-- Tony Blankley is executive vice president of Edelman public relations in Washington.
COPYRIGHT 2010 CREATORS.COM
http://www.politico.com/blogs/bensmith/0810/The_new_message_Improve_heal...
If at first you don't succeed...lie lie again.
Our brothers on the left have a new skrattigery...LOL.
That is if we make it till 2020. The thing is that other countries can run these size of deficits as a % of GDP but the US cannot. Simply because of the size of the economy and the fact that we are the largest importers in the world....meaning for others exports offset their problems for sometime but whom are we going to export to? we are the greatest consumers of resources the world has seen. I am afraid we really do not have much time and we are going to have a head on impact much sooner than anyone expects.
The Speaker of the House Nancy Pelosi is insane. Harry Reid is a child molester. Barry Soeto, aka, Barracky is not a citizen of the US. What could go wrong? Throw in guy who looks like Hitler, Axelrod, and nothing but good times ahead.
Wait a minute.... BLAME BUSH. BUSH DID IT.
When race becomes the reason to vote then race is to blame for failure.
The Speaker of the House Nancy Pelosi is insane. Harry Reid is a child molester. Barry Soeto, aka, Barracky is not a citizen of the US. What could go wrong? Throw in guy who looks like Hitler, Axelrod, and nothing but good times ahead.
Wait a minute.... BLAME BUSH. BUSH DID IT.
When race becomes the reason to vote then race is to blame for failure.
This game ony works until the rest of the world quits playing.
globalization's also a bitch.
Short TLT
There are certainly a lot of details like that to take into consideration.I read and understand the entire article and I really enjoyed it to be honest.
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