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June Deficit Fails To Account For $142 Billion In Excess June Borrowings; U.S. Has Issued $1.5 Trillion Excess Debt Over Budget In Past 4 Years

Tyler Durden's picture


As we reported earlier, the June US budget deficit came in around as expected, at $68.4 billion. Yet an interesting observation that we have touched upon previously, is that over the same period, the US borrowed a whopping total of $210.9 billion. Once again, as has been the case over the past four years, the US borrowed far more in any deficit month, then it needed simply to close the deficit. Case in point, the June differential was $142.5 billion more borrowed than "needed", the YTD (fiscal) differential is $290 billion, and the cumulative differential since the beginning of the 2007 Fiscal year (October 2006), is a whopping $1.5 trillion. Over the past 3 years and 9 months, the US has accumulated an incremental $4.7 trillion in new debt, even as the budget deficit has grown by "only" $3.2 trillion. One wonders just what the reason for this differential is, which amounts to half the cumulative budget deficit over the same time period? The cumulative data, as well as the stunning differential between the two time series is presented on the attached chart.

h/t Michael


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Tue, 07/13/2010 - 19:23 | 467472 rubearish10
rubearish10's picture

Funding entitlements at lowest rates???

Tue, 07/13/2010 - 22:42 | 467656 Inspector Asset
Inspector Asset's picture

Based on these findings presented by Tyler, I am switching my opinion to that of the US will politely default on its debt.


No hyper inflation , no deflation, maybe a little. Another 20% drop in home prices, along with the second crash, but maybe the crash will be in the bond market and not the stock market.


With Obama's lets cut checks to everybody mentality, and this post by Tyler, I am convinced, the default strategy, is what they will do.


Now they might pull a Donald Trump: In the 80's he was in bed with every bank in NY, so they had no choice but to restructure his loans on his real estate empire....


The same might happen with the dollar, that there will be so many floating around, internationally that, the world will have no choice but, to devalue, resructure , etc. 


Out of a diluted, over used dollar, and some nifty Special Drawing Rights, thanks to IMF and Soros, in with the NWO currency and out with the dollar.


You have to give  to the bankers, they all alot smarter than we give them credit.

Notice how America had the crisis first?

Paulson once claimed the crisis was a result of "imbalance between saving and debting nations." My question is, after seeing all these soverign nations on the brink of default, "Who the fuck was saving then?" Is China the only one saving?

If so, they will get bullies along to play the game, the military will see too it.

In the end America still comes out better than the rest. DOsen't make it right, make of it what you waNT,

This all of course just my opinion after a couple cocktails.


Long live Tyler,.





Tue, 07/13/2010 - 22:47 | 467659 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

the crisis was a result of "imbalance between saving and debting nations."

Saving bad, debting good.  Hank said so.

Wed, 07/14/2010 - 05:22 | 467758 Mentaliusanything
Mentaliusanything's picture

No no no no! debt means your wealthy - Debt is right. Debt works. Debt clarifies, cuts through, and captures, the essence of the evolutionary spirit. Debt in all of its forms; Debt for life, for show, for love, knowledge, has marked the upward surge of mankind and Debt, you mark my words, will not only fuck the banks, but that other malfunctioning corporation called the U.S.A.

Tue, 07/13/2010 - 22:47 | 467661 Inspector Asset
Inspector Asset's picture

You know what?

Based on the idea taht we live in the "united Corpaorations of America"

the stock market will not crash, Tyler, it will be the bond market.

Yes that is the way it will go down.

Unitl I knoe better..


Tue, 07/13/2010 - 23:00 | 467671 Inspector Asset
Inspector Asset's picture

On a separate topic:

How are we going to keep in touch,

when Obama shuts dowen the Internet for months at a time?


You that Bs isn't about cyber attacks from China, as it is about keeping a lid, on bloggers, that might cause a recuss. Tyler,, maybe the Drudge?


But they are worried , domestic bloggers , and the influnce they have ,

Thats my opinion and I am sticking to it.

Once the pyscological warfare on its own citizens wears off, or comes to light, big sis we step in to kill the net.

Whats you gonna do? 


Wed, 07/14/2010 - 03:48 | 467746 Bringin It
Bringin It's picture

It looks to me like stocks can not drop without exposing the valuations of other FIRE components  to pressure.  In particular, the insurance companies.

So they won't drop.  Like the steel girders of 9-11 sticking out of the rubble, the Dow will be sustained.

Where are those girders now?

Tue, 07/13/2010 - 23:35 | 467683 Manbarepig
Manbarepig's picture

Simplest possible answer. We're maxing out our Credit Cards while rates are low and new offers keep flooding into the mailbox.

Tue, 07/13/2010 - 19:26 | 467481 Fritz
Fritz's picture

Pay no attention to that man behind the curtain!

The great and powerful Oz has spoken.

Tue, 07/13/2010 - 19:27 | 467483 VK
VK's picture

This is really, really weird. More damned lies and fudged statistics. Hey, honey, I just lost $1.5 Trillion, just a 3 year long fat-finger.

Tue, 07/13/2010 - 22:44 | 467657 tgatliff
tgatliff's picture

Well, they could explain the reason for the difference, but none of use would would be capable of understand the explanation because it is SOOOO complex.  I mean, you would need at least 3 PHD's at a good quality university just to understand a basic summary, and I am sure none of us have those basic qualifications in this forum.  Thank goodness that there are people with "similar" qualifications like this at the Treasury, the Federal Reserve(s), and Goldman Sach, though. 

Tue, 07/13/2010 - 22:53 | 467665 Inspector Asset
Inspector Asset's picture

Enough , enough.

Its time to talk solutions. No more bitching.


Maybe we can create a million dollar lotto: I mean a million dollars for the ticket,.


So only the ultra rich could buy it, yet all the proceeds go to to the , Treasary, or the war on terror, whatever,


Then offer a a TV show, to offer up the excitment to the peaseantsw. Maybe even a pay per view.


remember kids: they call it PROGRAMMING for a reason.

Got TV Guide?



Wed, 07/14/2010 - 00:56 | 467716 The Eradicator
The Eradicator's picture


"I mean, you would need at least 3 PHD's at a good ivy league university just to understand a basic summary"

Wed, 07/14/2010 - 01:31 | 467724 agrotera
agrotera's picture

... and you just must have a pipe hanging out of the side of your mouth and you have to sound like Thurston Howell, III from Gilligan's Island.

Tue, 07/13/2010 - 19:29 | 467486 TooBearish
TooBearish's picture

Aint it the wars? - they still off budget, another one of Bam Bam's campaign promises that bit the dust on Jan 11, 2009.

Tue, 07/13/2010 - 23:13 | 467675 traderjoe
traderjoe's picture

That's my vote too. 

You know what, I don't think anyone cares. Nor do they want to. 98% of the people want the market to go up, and the entire financial services industrial complex does everything it can to hide the truth. Did not hear ONCE that AA's earnings estimates were $.20 a couple weeks ago. Mentions of the BDI have disappeared. NFIB surveys - passing mention. Defaults? 40 million on food stamps. I could go on and on. No one cares. It will go on until it cannot any longer. Who knows when that will be. The PTB will do whatever it takes. And the sheeple want to believe. They are easy marks. Makes me wonder if the Blue Pill is really the better one...

Wed, 07/14/2010 - 03:52 | 467747 Bringin It
Bringin It's picture

I don't grok the pills, but other than that


your post is the unfortunate truth.

Wed, 07/14/2010 - 05:53 | 467766 Mentaliusanything
Mentaliusanything's picture

So in summary, your saying - Just lie to me - please just lie because the pills just don't cut the mustard and if I hear the truth it will irreparably harm my passive nature.

 Like 40 million on food stamps

rail traffic falling

Baldry falling over a cliff

unemployment stuck at +450,000 weekly

People starving or being bankrupted by needed pills

Balance of trade un- fucking expectedly growing the wrong way

China with the infection imported from the Banks of the World

Metal prices on a precocious wobble

US dollar interest at Slut pricing

Foreclosures needing high powered glasses to see the rise through the clouds

Pointless war with nations who will bleed your brave Sons and break a mother heart

Corporations calling the shots in a sovereign Gulf while the testicles of confusion are shrinking daily

Markets that are so corrupt that even children can see the maleficence.

Watch dogs glued to tranny porn while the greatest thief in history is allowed

Obscene bonuses paid to people who strip cash from those who sweat, save and hope in trust

Bank reforms that keep the dogs of debt free until most who suffered have died.

Constitutions and declarations that are debased to less than toilet paper

Police 'tasering' 85 year old invalids in their beds.

Minimum wages that parrots could not live on

Yet I know for a fact it is the people who make you great. slow to anger but the most inventive and friendly people on the face of the Earth. who say  I pledge allegiance to my Flag,and to the Republic for which it stands: one Nation indivisible,With Liberty and Justice for all.

Just fix the last 5 words before you are interned 




Wed, 07/14/2010 - 06:43 | 467773 Dental Floss Tycoon
Dental Floss Tycoon's picture

 I pledge allegiance to my Flag,and to the Republic for which it stands: one Nation, UNDER GOD, indivisible,With Liberty and Justice for all.

Wed, 07/14/2010 - 07:13 | 467776 Mentaliusanything
Mentaliusanything's picture

Shows you how old I am and the original, correctly allowed the separation of state and religion which I fully support. 

Wed, 07/14/2010 - 07:14 | 467777 Mentaliusanything
Mentaliusanything's picture

double post

Wed, 07/14/2010 - 20:10 | 469746 Dental Floss Tycoon
Dental Floss Tycoon's picture

I too learned it the old way, but it does add to the irony.

Tue, 07/13/2010 - 19:30 | 467488 SnarkAttack
SnarkAttack's picture

I'd assume this is from reducing the average duration of debt outstanding.

Tue, 07/13/2010 - 19:36 | 467497 cswjr
cswjr's picture

I suspect that you're right.  It'd be a p.i.t.a. to verify, though.

Tue, 07/13/2010 - 19:31 | 467490 MiguelitoRaton
MiguelitoRaton's picture

Probably building up reserves for the final collapse...or not

Tue, 07/13/2010 - 19:32 | 467492 bkrolik
bkrolik's picture


Did you try to account for debt repayment/maturity and intra-government transfers (like social security)? I am not sure how they balance deficit, just guessing....



Tue, 07/13/2010 - 19:36 | 467495 nonclaim
nonclaim's picture


I don't know if this article was posted before but the author gives a short and sober assessment of the current situation:

Any and all government “stimulus” retards growth because it removes current and future wealth from its producers and gives it to central planners who are not subject to the market but to voters, a significant part of which do not pay for the bread and circuses they demand, sadly trading their liberty for a false economic security that ends in the collapse of the welfare state while stripping real job creators of their property and the incentive to create.  In case the moral argument and this brief economic one do not suit you, I suggest reading and sending to as many people you can Henry Hazlitt’s simple classic “Economics in One Lesson,” and specifically this chapter on public works, which explains the myriad economic fallacies pervading the nation with regard to public works.

Tue, 07/13/2010 - 19:52 | 467514 Reese Bobby
Reese Bobby's picture

Great comment. Thanks for the link.

Tue, 07/13/2010 - 20:19 | 467540 linrom
linrom's picture

The quote that you cite is 'literary bullshit'; it has nothing to do with economic reality where all wealth flows from the bottom to the top. The welfare state cannot exist in the real world.

How does this relate to the disparity between borrowings and outlays?



Wed, 07/14/2010 - 08:46 | 467822 dcb
dcb's picture


didn't your mother ever teach you how to behave. i.e thre are other ways to say hat you want. All you have managed to do is get others to think you are full of BS. *as per the number of Junk hits

Tue, 07/13/2010 - 20:28 | 467549 spinone
spinone's picture

the chapter on public works assumes a closed economy.  Now when we build public works, we take jobs from China.

Tue, 07/13/2010 - 21:41 | 467611 Anonymiss
Anonymiss's picture

thanks for the link.

Tue, 07/13/2010 - 22:57 | 467667 tgatliff
tgatliff's picture

It kills me when people confuse "creating jobs" with unemployment.  The two are not the same.  

Unemployment is nothing more than a person feeling their skills are worth something, but the market cannot support this amount.  Meaning, could we have 100% employment if everyone went to work for 25 cents per hour?  Absolutely, but could this still be achieved if everyone was paid $40K?  Most likely not...

In short, economic fundamentals is rather simple and all goes back to productivity.  If you can build something (or provide a service) that saves me more than I pay you, then your wage is justified.  If not, then your nation must have an ever increasing debt consumption (public,private,diluationary) to balance the economic equation.

Wed, 07/14/2010 - 04:03 | 467748 Bringin It
Bringin It's picture

Regarding your short fundamentals, While not entirely untrue, it is the story after you've collected all the marbles and trampled the commons.  How much of someone else's inalienable rights can be acquired via stealth? 

A lot apparently.

There are entitlements for both ends of the spectrum and all in between.

Tue, 07/13/2010 - 22:59 | 467670 tgatliff
tgatliff's picture

It kills me when people confuse "creating jobs" with unemployment.  The two are not the same.  

Unemployment is nothing more than a person feeling their skills are worth something, but the market cannot support this amount.  Meaning, could we have 100% employment if everyone went to work for 25 cents per hour?  Absolutely, but could this still be achieved if everyone was paid $40K?  Most likely not...

In short, economic fundamentals is rather simple and all goes back to productivity.  If you can build something (or provide a service) that saves me more than I pay you, then your wage is justified.  If not, then your nation must have an ever increasing debt consumption (public,private,diluationary) to balance the economic equation.

Tue, 07/13/2010 - 19:35 | 467496 Max Hunter
Max Hunter's picture

What's a trillion here or there between friends?

Tue, 07/13/2010 - 19:44 | 467504 Ragnar D
Ragnar D's picture

"Friends"?  There are no friends here, pal.  I'm just here to collect half your paycheck because the poverty pimp I vote for told me I'm Entitled to it.

While I'm buying stuff with your check, I still want you to die because I was told you're the enemy and the reason I don't have your stuff.

No friendship here.  But keep working 10 hour days because apparently the reason we're broke is you aren't paying for your "fair share" of stuff I want...

Tue, 07/13/2010 - 20:58 | 467575 AVP
AVP's picture


Tue, 07/13/2010 - 22:27 | 467649 ShankyS
ShankyS's picture

Brilliant! Over the top on the $$$



Wed, 07/14/2010 - 08:33 | 467808 Max Hunter
Max Hunter's picture

I thought my sarcasm was apparent..

Tue, 07/13/2010 - 19:46 | 467507 demsco
demsco's picture

don't confuse annual deficits with long-term deficits. What was reported today was part of the annual deficit, not the total deficit which is why we borrow so much every month. If we failed to raise that money every month it is lights out.

Tue, 07/13/2010 - 20:13 | 467532 Slash
Slash's picture

this makes sense, sort of like getting while the getting is good........or while the perpetual "create new money, loan to gov/banks, get banks to buy gov debt, let sheeple pay the interest" circle jerk still works?

Tue, 07/13/2010 - 22:45 | 467658 jkruffin
jkruffin's picture

Must be why the total debt is over 54 Trillion then, makes perfect sense when you add SS, Meds, other entitlements.  So they have been working us over for more than 4 yrs you think?  Like 30 yrs is more like it.

Wed, 07/14/2010 - 01:43 | 467726 Lux Fiat
Lux Fiat's picture

I'm guessing/hoping that is it as well.  Gov't still has to roll debt issued 30, 10, 7 yrs ago that matures in the current period (because we certainly are retiring it...).  In addition to new debt issued to fund the current year deficit.

Tue, 07/13/2010 - 19:49 | 467511 Bear
Bear's picture

Obama Stash

Tue, 07/13/2010 - 23:59 | 467697 Mark Beck
Mark Beck's picture

Did they really say stimulus money came from Obama stash?

Being from Detroit, I would like to distance myself from those remarks. I would also like to say that there are people in Detroit who understand the mismanagement of our money system by the FED, and are familiar with the Treasury accounts. And I can safely attest that there is no such Obama Stash line item.

Good night, and thank you for your support.

Mark Beck

Tue, 07/13/2010 - 19:54 | 467516 Orly
Orly's picture

Remember me if I am mistaken, but...

Didn't the Fed just actualise the debt of Fannie and Freddie, as seen last week here on ZeroHedge?  This sounds remarkbly close to the amount needed to "transfer" (Bruce has it as an account gimmick...) a trillion from one balance sheet to two others, plus interest and assorted fuck you fees included for good measure.

Maybe this is the bill the Fed sent itself for "facilitating" Fannie and Freddie?


P. S. It is good to see Grand Supercycle out and about.  I have a feeling we're about to get it on...

Tue, 07/13/2010 - 20:03 | 467522 Zina
Zina's picture

Assuming that short term securities with maturities of 3 month, 6 month, 1 year, etc, are included in this "Cumulative Federal Debt Issuance", then we may understand the gap.

Rolling over the debt is not accounted into the Budget Deficit, is it?

Tue, 07/13/2010 - 20:26 | 467546 linrom
linrom's picture

Simple answer to the question of timing? Tks.

Tue, 07/13/2010 - 20:16 | 467536 krb
krb's picture

Would some be deficit and some roll?  krb

Tue, 07/13/2010 - 20:18 | 467538 buzzsaw99
buzzsaw99's picture

Still a bunch of stuff they haven't counted in that.

Tue, 07/13/2010 - 20:48 | 467561 Sancho Ponzi
Sancho Ponzi's picture

Maybe it's being funneled to Bernanke's prop desk;)

Tue, 07/13/2010 - 20:55 | 467569 Bear
Bear's picture

It's a zillion ES contracts ... longs bought over months of Bid, Bid, whose got the Bid ... watch out below

Tue, 07/13/2010 - 21:14 | 467582 Sancho Ponzi
Sancho Ponzi's picture

Wouldn't that be epic? Bernanke & Geithner, LLC borrows $1.5 trillion above and beyond what's required to cover current obligations in order to reflate equities.

Tue, 07/13/2010 - 22:04 | 467634 plocequ1
plocequ1's picture

OMG!! I better take my protein pills and put my helmet on.

Tue, 07/13/2010 - 20:57 | 467572 Bear
Bear's picture

Warning: Visiting this site may harm your computer!

The website at contains elements from the site, which appears to host malware – software that can hurt your computer or otherwise operate without your consent. Just visiting a site that contains malware can infect your computer.

For detailed information about the problems with these elements, visit the Google Safe Browsing diagnostic page for

Above warning coming from Google



Tue, 07/13/2010 - 21:45 | 467618 nwskii
nwskii's picture

No shit WTF? I think OBAMA and his Minyons dont want anyone on this site

Tue, 07/13/2010 - 22:04 | 467635 GeoFizz
GeoFizz's picture

I got the same thing.  I'm on a Mac using Safari, if that makes a difference...

Tue, 07/13/2010 - 22:26 | 467648 Bear
Bear's picture

Google Chrome gave me the message ... Explorer and Firefox no so much as a peep

Wed, 07/14/2010 - 00:05 | 467699 Hephasteus
Hephasteus's picture

When there's not limit to what android get's. There's not limit to android's destructive potential.

Tue, 07/13/2010 - 22:56 | 467666 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Who had July 13th in the pool?  Is this the first report of this?

Tue, 07/13/2010 - 23:35 | 467679 bc0203
bc0203's picture

If you look up the site using Google's own tool you get the following info:


What is the current listing status for

This site is not currently listed as suspicious.

Part of this site was listed for suspicious activity 1 time(s) over the past 90 days.

What happened when Google visited this site?

Of the 3 pages we tested on the site over the past 90 days, 0 page(s) resulted in malicious software being downloaded and installed without user consent. The last time Google visited this site was on 2010-07-13, and the last time suspicious content was found on this site was on 2010-07-13.

Malicious software includes 554 trojan(s).

This site was hosted on 1 network(s) including AS16265 (LEASEWEB).

Has this site acted as an intermediary resulting in further distribution of malware?

Over the past 90 days, did not appear to function as an intermediary for the infection of any sites.

Has this site hosted malware?

Yes, this site has hosted malicious software over the past 90 days. It infected 114 domain(s), including,,




Tue, 07/13/2010 - 23:57 | 467696 jdrose1985
jdrose1985's picture

I was browsing some of the older articles and comments posted by specific users and kept coming across a spammer who was posting tons of links, thereby updating the articles. wasn't sure what the deal was but reported him to the abuse link, his posts are gone now but maybe this had something to do with it?

Tue, 07/13/2010 - 20:57 | 467574 MacedonianGlory
MacedonianGlory's picture

Titanic debt.

Tue, 07/13/2010 - 21:42 | 467614 Implicit simplicit
Implicit simplicit's picture

Its all FIAT- Forget Instilling Any Trust

Tue, 07/13/2010 - 20:58 | 467576 ChristopherWhite
ChristopherWhite's picture

This $1.5 trillion is the amount of bribes and payoffs paid for with gov't cheese.

Tue, 07/13/2010 - 22:51 | 467664 TBT or not TBT
TBT or not TBT's picture

They are building underground cities so a few million will survive the asteroid impact, assuming our heroes fail to blow it up in time, like in Armageddon.  

Or maybe they are building giant arks in the Himalayas, like in 2012.

Anyway, that's obviously where the money is going, to save humanity from extinction.   Obama is a good man too.

Tue, 07/13/2010 - 22:57 | 467668 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Mmmmmmm, government cheese.

Wed, 07/14/2010 - 01:52 | 467728 Gubbmint Cheese
Gubbmint Cheese's picture

huh what?!?!?!

Tue, 07/13/2010 - 21:02 | 467578 buzlightening
buzlightening's picture

rat basturds can't do better than leave zeroooooo for the sheeple when they bug out to destinations unknown!  With lil scamBO's ratings he's selling seats on air force one to the highest CONgressional/SINate bidders!!  Bug out before the chiGAGo dog'n pony show bites barry in goon ASSets!

Tue, 07/13/2010 - 21:19 | 467589 jkruffin
jkruffin's picture

There is no mystery, just lack of accountability,  we all know the money is sitting in the stock market under reigns of the PPT.  They can try to hide it, years ago they might have gotten away with it, but not in today's technological world as news gets around.

Tue, 07/13/2010 - 21:28 | 467602 gimli
Tue, 07/13/2010 - 21:29 | 467603 BurningFuld
BurningFuld's picture

Would that difference not be refinancing of past Tresuries that come due?

Just thinkin' out loud.

Tue, 07/13/2010 - 21:32 | 467606 Implicit simplicit
Implicit simplicit's picture

They will have to keep funnelling money to unknown third parties in exponential fashion as time goes by. They obviously didn't see the hidden fuse in the debt clock inner workings, or they are simply math challenged.

Tue, 07/13/2010 - 21:46 | 467619 LePetomane
LePetomane's picture

I remember three tranches 0f ?700+? billion being thrown around the same time TARP was taking shape in the fall of 2008.

Tue, 07/13/2010 - 22:07 | 467639 LePetomane
LePetomane's picture

Damn this is going to bug me.  The first tranche was very specific 758 Billion or something. 

And was being thrown around the same time TARP I was being debated.

Tue, 07/13/2010 - 21:52 | 467621 Voodoo Economics
Voodoo Economics's picture

If it is due to a roll from Lterm to Sterm and with the amount of crap that the US has to roll in the next two years then what will happen if Shot Term Treasuries Spike (eg. china stops buying just because, or they threaten both taiwan and to stop buying at the same time)?


Tue, 07/13/2010 - 21:58 | 467630 gimli
gimli's picture

After Aragorn -- I would follow Dylan Ratigan.........

although I might have to slap him around occasionally -- just so he remembers to breathe--- he handles both the questions and the answers -- no need for any guests

Tue, 07/13/2010 - 22:05 | 467636 BaboonAss
BaboonAss's picture

Shall I email US Treasury customer support and ask "what gives?" ?

Tue, 07/13/2010 - 22:08 | 467640 Rick64
Rick64's picture

 Yes we are right on track. Thanks politicians we the people really owe you.

Tue, 07/13/2010 - 22:12 | 467642 billwilson
billwilson's picture

Part is Social Security. Social Security runs a surplus every year (so far). This surplus reduces the deficit as accounted for by the Feds, but the money is actually being borrowed from Social security so it is adding to the debt.


So say the deficit is $300 without Social Security but only $200 with it included (Social Security is on budegt). The government still has to borrow $300 ($200 from the markets and $100 from the Social Security Trust Fund).

Wed, 07/14/2010 - 00:40 | 467711 John_Coltrane
John_Coltrane's picture

Borrowing from SS (intergovernmental borrowing) is certainly part of it as cash flow on SS receipts aren't quite meeting outflows this year (which tells you how bad Unemployment really is).  Bruce Krasting had a recent post on this issue.

The other is retiring long term and being forced to sell more short term bills to avoid a nasty auction failure.

And off balance sheet war spending is the other factor as noted by others.

Tue, 07/13/2010 - 22:14 | 467643 RobotTrader
RobotTrader's picture

Two-hundred and four years.
- Tue, Jul 13, 2010 - 02:32 PM

That's how long it took Uncle Gorilla to rack up his FIRST one-trillion
fiatscos of sovereign debt.

1776 to 1980.

1980: The year that Ras first began screeching "We're
scroomed!" precisely because of that one-trillion fiatsco number.

And 3-month T-bill interest rates were at an annualized:


Fast-forward to today.

Thirty years on.

As ZeroHedge dutifully reports here:

...Uncle is now running up a trillion fiatscos of additional
sovereign debt EVERY NINE MONTHS!

And 3-month T-bill yields?

How about virtually ZERO percent?

And total Uncle Gorilla debt amassed (on the books, anyway)?


Or fourteen hundred percent higher than the level at which a
then-young, greenhorn Rasputin screamed "This can't go on!"

LOL, it can go on.

And will.

Forever and ever, amen.

Wed, 07/14/2010 - 03:03 | 467732 Burnbright
Burnbright's picture

Silly robo, I really don't even know where to begin. But I guess if it only takes someone 30 years to believe this what can you say?

LOL, it can go on. 

And will. 

Forever and ever, amen. 

Wed, 07/14/2010 - 07:45 | 467782 trav7777
trav7777's picture

Nobody, repeat NOBODY should be at ALL surprised by the size of the debt when the growth rate has been relatively level over time!

The debt has been doubling every 7 years or so.  In another 7, it will be 26T.  This is the simplicity of the math!

There's an old parable about a king, grains of rice, and a chessboard out there.  Behooves everyone to grasp it.

They should teach geometric growth to rubes solely as a doubling interval...seems to be the only way they can get it.  People understand doubling from blackjack and billiards

Tue, 07/13/2010 - 22:33 | 467652 rapier
rapier's picture

Expainations for the discrepancy.

I am pretty sure the Feds SFP fund of at least $200  billion would not be counted since it is sitting in an account, at the ready.  For what?  I am sure there is a long line of institutions drooling over it.

I think there is still a hefty balance in TARP.  As above, money borrowed not spent.

I know the chart says Cumulative Debt Issuance but perhaps they are counting some borrowing that is just rolling over expring paper.  Just a guess.

It would serve everyone if ZH was not quite so breathlessly conspiratorial.  The books of the USG almost certainly balance without positing some grand conspiracy.  The truth is bad enough. 

The biggest secrets are hidden in the DOD and the various intellegence   agencies.  The DOD alone has no clue where 300 or so billion goes every years. 

Tue, 07/13/2010 - 23:28 | 467678 Misean
Misean's picture

"The books of the USG almost certainly balance without positing some grand conspiracy."


They most certainly DO NOT balance.  Not cash flow, not actuarially.  There have been numberous studies of the Pentagrams books, HUDs books, Unfunded liabilities...on and on.  No one knows where it all is, or where it all goes.  Assets are managed so poorly, that when something important disappears, tptb would rather it just stay disappeared.

Oh, I'll agree this is unlikely a conspiracy for the most part.  Give a pile of worthless bureauRATS a blank check, and they'll create a money sinkhole for the ages.

Then we can talk about the deliberate stuff...

Tue, 07/13/2010 - 22:31 | 467653 ShankyS
ShankyS's picture

"If the American people ever allow private banks to control the
issue of their currency, first by inflation and then by deflation, the
banks and corporations that will grow up around them will deprive the
people of all property until their children will wake up homeless on the
continent their fathers conquered."
—Thomas Jefferson, letter to Albert Gallatin, 1802

Tue, 07/13/2010 - 22:50 | 467660 bullandbearwise
bullandbearwise's picture

Debt and deficit have two different meanings: Debt is the total amount borrowed, deficit is the budgetary difference between income and outgo. You're comparing apples to oranges.

In a sovereign economy, deficit is always less than debt. Which is why deficit is such an MSM darling. It doesn't "seem" as bad when you cite deficit-to-GDP ratios.

Wed, 07/14/2010 - 03:08 | 467735 Burnbright
Burnbright's picture

I get what you are saying but in reality it doesn't work that way, if you owe a certain amount of money no matter how you cut it up or try and cover it up it is still X amount either way.

Tue, 07/13/2010 - 23:55 | 467684 jkruffin
jkruffin's picture

After searching around, the only thing that I could find to explain(if thats what you want to call it) the difference is this:

The gross debt increases or decreases as a result of this unified budget deficit or surplus. However, there is certain spending (supplemental appropriations) that add to the gross debt but are excluded from the deficit. The total debt has increased over $500 billion each year since fiscal year (FY) 2003, with increases of $1 trillion in FY2008 and $1.9 trillion in FY2009.[4]


Supplemental Appropriations  


Now, I ask, what is that?


And then I found this:

Fannie Mae and Freddie Mac obligations excluded See also: Federal takeover of Fannie Mae and Freddie Mac

Although not included in the figures reported by the government, the U.S. government has moved to more explicitly support the soundness of obligations of Freddie Mac and Fannie Mae, starting in July 2008 via the Housing and Economic Recovery Act of 2008, and the September 7, 2008 Federal Housing Finance Agency (FHFA) conservatorship of both government sponsored enterprises (GSEs). The on- or off-balance sheet obligations of those two independent GSEs was just over $5 trillion at the time the conservatorship was put in place.[12]

The government accounts for these corporations as if they are unconnected to its balance sheet.


And then I found this too:


Guaranteed obligations excluded See also: Temporary Liquidity Guarantee Program and Exchange Stabilization Fund

Starting in late 2008, the U.S. federal government is guaranteeing large amounts of obligations relating to mutual funds, banks, and corporations under several new programs designed to deal with the problems initiated by the Liquidity crisis of September 2008. Guarantees are off-balance sheet and therefore excluded in the calculation of federal debt. The funding of direct investments made in response to the crisis, such as those made under the Troubled Assets Relief Program, are captured by the debt totals.

Wed, 07/14/2010 - 03:14 | 467737 Burnbright
Burnbright's picture

Starting in late 2008, the U.S. federal government is guaranteeing large amounts of obligations relating to mutual funds, banks, and corporations under several new programs designed to deal with the problems initiated by the Liquidity crisis of September 2008. Guarantees are off-balance sheet and therefore excluded in the calculation of federal debt. The funding of direct investments made in response to the crisis, such as those made under the Troubled Assets Relief Program, are captured by the debt totals.

Oh that is priceless, so the banks are lending the treasury money at interest so that they can indirectly have the treasury borrow money on their behalf to get essentially hand outs and interest free loans. Is that the snake eating its tail?

Wed, 07/14/2010 - 08:38 | 467813 OldTrooper
OldTrooper's picture

My gut instinct is to say that the gov't is shoring up some one's balance sheet.  Just speculation at this point.  We won't really know much until the 'veil of transparency' is pierced.

How in the world can you run a 'budget deficit' if you don't even have a budget?  Does the 'budget' mean anything at all anymore?  Isn't the whole idea of a federal budget as outdated and ignored as that legal anachronism, the Constitution?

Tue, 07/13/2010 - 23:42 | 467687 metastar
metastar's picture

...let me slide it on you know people...

It's only 1's and 0's rolling in time, growing in size, and picking up speed.

until ...




Wed, 07/14/2010 - 00:07 | 467700 Misean
Misean's picture

Despite all the caterwalling, they do have to roll over the expiring bonds that they aren't able to pay off every month as well.

Wed, 07/14/2010 - 01:19 | 467721 Bruce Krasting
Bruce Krasting's picture

This is the May 2010 balance sheet of the Federal Financing Bank. $53b. This is small part of what is borrowed and not on the debt numbers. There are many things like this. The federal government is a master at off balance sheet financing.


Wed, 07/14/2010 - 07:21 | 467778 papaswamp
papaswamp's picture

MBA Mortgage apps.

"The Refinance Index decreased 2.9 percent from the previous week and the seasonally adjusted Purchase Index decreased 3.1 percent from one week earlier. This was the lowest Purchase Index observed in the survey since December 1996.  The unadjusted Purchase Index decreased 12.7 percent compared with the previous week and was 43.0 percent lower than Independence Day week one year ago.


If I read the market tea leaves correctly...this should cause the market to go up since bad is good, mediocre is good, and ok is absolutely amazing.

Wed, 07/14/2010 - 08:49 | 467836 dcb
dcb's picture

I find this fascinating. and I would suggest it getsent to major news outllets. there is a real piece of investigative journalism here

Sat, 08/14/2010 - 10:42 | 521607 herry
herry's picture

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