US Treasury Burns $90 Billion in 8 Days

Tyler Durden's picture

More scary stuff from the US Treasury which has resumed living auction to auction, even as it has plundered over $80 billion in G and CSRD retirement fund money to provide cap under the debt ceiling, a number which will eventually rise to $270 billion by August 2nd at which time all bets are off unless the politicos in DC finally relent with their soap opera and allow the inevitable $2 trillion debt ceiling hike (which probably won't happen. Instead Congress will start voting on incremental $200 billion debt ceiling hikes month to month in order to keep the public glued to their TV in a demonstration of just how fiscally prudent Congress is). In the meantime, here's the math: in the first 8 days of the month of June, the Treasury has seen its cash balance decline from $112.6 billion to $23.5 billion: a solid burn rate of $90 billion in just over a week. But lest readers think that this is due to paying down debt, it isn't: total US debt was flat (at the ceiling), while intragovernmental holdings declined by $20 billion to accomodate another $20 billion in marketable debt (see the plunder of retirement accounts discussed above). So how does one reconcile this data? Simple - in June the Treasury has collected $44 billion in withheld individual income taxes (and a whopping $400 million in corporate tax), while spending double that, or $89 billion. Fiscal prudence? Rhetorical.

June Cash:

June Debt:

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camaro68ss's picture

Amerika, land of the in debted, home of the slave.

Me love Amerika

Strider52's picture

Man, there's a GREAT pic of Bernanke burning money at

  Someone with pic-posting priveledges should go get it and post it here. 

  Tyler? Tyler?



speconomist's picture

There you go:

And remember that you have to pay the special fee (donation to Tyler and Marla) to be able to post pictures!

MarketTruth's picture

We're all living in Amerika...

We're all living in Amerika
Amerika ist wunderbar
we're all living in Amerika

Do you want me?
(no I don't)
Do you need me?
(No I don't)
Dance with me I'm leading?
(No I can't)
Will you love me?
(No I won't)...

If you don't want me
(You'll get hurt)
If you don't need me
(You'll get hurt)
If you don't love me
(You'll get hurt)
Fuck you is the magic word

We're all living in Amerika
Amerika ist wunderbar
we're all living in Amerika

We're all living in Amerika
Coca Cola, Wonderbra
We're all living in Amerika

equity_momo's picture

Dont fight the Fed? Bernanke should not fight the Math.

One_Eyed_Pony's picture

I've been posting notes on US Treasury Daily and Monthly reports for years on what these Washington Wackos are doing...


Glad to see ZEROHEDGE finally picked up on my posts/threads in cyber-circus-world

Tyler Durden's picture

Oddly enough, we have been posting on the DTS for years too...

One_Eyed_Pony's picture

Yes, we know the past... and had to correct your "mis-understanding" that the Treasury Supplemental Financing Program (TSFP) was active again and what it meant.

Tyler Durden's picture

The only "misunderstanding" is predicting ahead of everyone it was going to be shut down for the Treasury to avoid an early debt ceiling hit.

Here Comes Another $25 Billion In Excess Weekly Liquidity To Ramp Up Stocks

...followed promptly by this:

Whispers Of The Inevitable Unwind Of The Fed's SFP Program And The Ensuing $200 Billion Liquidity Injection Commence

Also it is SFP.

camaro68ss's picture

Sorry one eye pony, Zero Hedge ALL THE WAY BITCHEZ!

holdbuysell's picture

Seven minutes to reply and provide previously-posted data.


writingsonthewall's picture

First rule of zero hedge - NEVER argue with Zero hedge

Now when does project mayhem start? or have I missed the boat on that one too?

Clayton Bigsby's picture

Dude, the hater store called - looks like they're all outta you...

JW n FL's picture

Hey Tyler! do you remember when I taught you how to type in word?


how about when I taught you how to drink vodka?


how about when I taught you how to order hookers 3 at a time? double winning is for bitchez! we triple win mother fuckers!


Tiger blood that! I taught Tyler his abc's! and his 123's!


as a matter of fact.. refreasher!


for all of those worried.. Tyler was not hurt in the typing of this silly shit! I am just sorry I missed this other dumb fuck above!?!!?!!!!!?????!!??!!?! damn it!

Kina's picture

1-eyed only came to advertise its site. Had to say some shit to get attention.

tony bonn's picture

well that's 4.1t annualized but the indonesian originally asked for what's the difference - libya or dubuya?

GeneMarchbanks's picture

"Instead Congress will start voting on incremental $200 billion debt ceiling hikes month to month in order to keep the public glued to their TV in a demonstration of just how fiscally prudent Congress is"

Really? This shitshow is on TV? Maybe this is just some theater for the Chinese since ,technically, they are the only ones who should care.

plocequ1's picture

I increased my weekly federal witholding tax an extra $50.00. Im having bad feelings

Spalding_Smailes's picture

When will this hit the street  ....


WASHINGTON (CNNMoney) -- Many American companies would love to move the big pot of money they make overseas back to the United States -- saying they could use the money to create jobs -- and they're pushing in Congress for a tax break to do so.

But as Congress continues to grapple with mounting budget deficits, and amid talk of revamping the tax system, the corporate tax holiday could get traction. Generally, the U.S. corporate tax rate stands at 35%, the highest in the industrialized world. But companies don't have to pay that rate on profits made outside of the United States. So lots of companies shelter profits offshore.

The tax holiday would lower the corporate tax rate to 5.25% for big companies such as the bill's proponents -- including Google , Oracle, CiscoProponents say the move would bring as much as $1 trillion into the United States, spur big companies to create jobs and give Treasury more revenue to work with to slash mounting federal deficits.

But tax holiday opponents, including Treasury Secretary Timothy Geithner, are skeptical. They say a similar holiday in 2004 didn't spur companies to hire more or grow.

Nevertheless, last week, a bipartisan group of lawmakers filed a bill that would reduce the corporate tax rate to 5.25% on offshore earnings brought back to the United States.


Tyler Durden's picture

This hit the street 4 months ago when both Zero Hedge and the street found it would have no impact whatsoever on anything.

  1. In 2005, HIA-1 delivered much less in direct employment and
    investment than promised. For example, see “Tax Incentives and Domestic
    Investment: An Empirical Analysis of the Repatriation Decisions of U.S.
    Multinational Corporations Following the Implementation of the Homeland
    Investment Act of 2004” Michaele L. Morrow, Ph.D,. Dissertation, Texas
    tech University, May 2008, or “Watch What I Do, Not What I Say: The
    Unintended Consequences of the Homeland Investment Act “ J Dhammika
    Dharmapala, C. Fritz Foley and Kristin J. Forbes, Journal of Finance,
    forthcoming (2011).
  2. Under HIA-1, the incentives to increase
    employment and investment were limited. The major impact of HIA-1 was to
    allow foreign earnings to be repatriated at low tax rates, with few
    binding additional requirements. From firm’s point of view, HIA-1 was
    equivalent to a lump-sum tax benefit which would generate additional
    investment and employment primarily in cases in which firms had
    restricted access to credit markets. Firms with large amounts of profits
    abroad probably could borrow domestically for hiring or capital
    expansion so would not have been constrained in their prior investment
  3. Crafting a bill that increases direct marginal
    incentives for employment and investment is difficult. If the
    requirements are too stringent, firms will simply pass on repatriation.
    If firms are already unconstrained with respect to hiring and
    investment, a marginal increase may bring forward investment plans into
    2011, with some payback in subsequent years. If the terms are relatively
    lax, as in HIA-1, the impact on direct employment and investment will
    be small.
  4. The firms that have the money abroad (tech, pharma)
    are not the sectors that need the most balance sheet help (households,
    real estate, state and local government) nor does it help firms whose
    operations are primarily domestic.
  5. Repeating HIA produces
    incentives for firms to keep funds abroad. There is the risk that firms
    will see HIA as a once or twice a decade low-tax repatriation
    opportunity. The extent of these incentives depends on the gap between
    US domestic and foreign tax rates. The combined effect of HIA plus a
    reduction in US corporate rates would largely mitigate these incentives.
    Surprisingly, BEA data suggests that until the possibility for HIA-2
    emerged again in early 2009, the aggregate dividend repatriation rate
    was not much lower than it had been prior to HIA-1(Figure 1), and the
    low repatriation since 2009 could also reflect limited US investment
Spalding_Smailes's picture

Just passing along the update ....


Proponents say the move would bring as much as $1 trillion into the United States, spur big companies to create jobs and give Treasury more revenue to work with to slash mounting federal deficits.

Nathan Muir's picture

No, you pass on garbage MSM propaganda. 

A Man without Qualities's picture

Proponents say the move would bring as much as $1 trillion into the United States, spur big companies to buy back stock from preferred clients, pay large bonuses to senior management, and encourage more businesses to move operations offshore (tax deductible exceptional costs) in order to take advantage of next tax holiday, shove money to lobbyists and into the coffers of campaign funds and give Treasury more time to come up with a weak excuse why it has not helped to slash mounting federal deficits.

I think that's fixed it...

Fiat2Zero's picture

Smailes you're weak.  Express an opinion that isn't regurgitated directly from your squid Master.

karzai_luver's picture

take it like a man(?) after a crushing like that....just pull the covers

over yer head son.



cosmictrainwreck's picture

poor bastard thought he had somethin' (finally) ooops..........

prophet's picture

In just one minute.


101 years and counting's picture

ROFL!  companies just want to bring that cash back so they can buy back company stock so the execs can sell at higher prices.  they dont want to hire anyone.

seriously, anyone believing this garbage needs to get examined.


SilverDosed's picture

Hey, at least they're not causing giant disasters *cough BP* to drive the price of their stocks down for major buybacks and then laughing at the measley couple billion they dont actually pay for the cleanup.

tiger7905's picture

Here's where Royal Bank of Scotland is getting there excess funds, screw the little guy. They put loan sharks to shame.

Fiat2Zero's picture

You're such a shill smailes.  The only question is whether you get paid for your shilling, or whether you're doing it "pro bono" (i.e. begging at the Master's table for some scraps).

MSM puppet.

JollyRoger's picture

No one can stop the QE deficit spending love affair.  Their feelings for one another are too strong.

bigdumbnugly's picture

i bet they'll have ugly offspring...

cougar_w's picture

And the actor was not actually in-bred. But they all say that.

A Man without Qualities's picture

Just to put this into context, Apple's recent blockbuster quarter produced $25 billion in revenue, and $5.99bn profit.  So this profit would only cover the government deficit for ONE FUCKING DAY!  

LongBalls's picture

Please do not put anything into context ever again. Doom will not come if we do not focus on it.

Temporalist's picture
Fresh Downgrade Threat to U.S. Debt

"A third rating agency threatened to downgrade the U.S. government's credit status if Congress failed to increase the nation's borrowing limit by early August, increasing pressure on lawmakers and the Obama administration to reach a deficit-reduction deal."

cougar_w's picture

The rating agencies work for the banks. The banks want the QE3, and they want it yesterday. Increasing the borrowing limit is necessary since the Tres needs to sell bonds into queasing for the Fed to monitize as part of QE3 for the banks. Without a rise in the debt ceiling the beautiful music stops.

And we cannot have that, certainly not.

101 years and counting's picture

obama on vacation again this week....burning thru the cash?


Waterfallsparkles's picture

When Obama won the Presidency he thought he won an all expense vacation for 4 years to anywhere he wanted to go.  Only prerequisite was to give a speech every now and then.

HamyWanger's picture

And so what???

It's not like we're a poor country. We have the means to spend all that money in one week. We ain't no Bangladesh or Zimbabwe. 

I can't imagine for a second the United States of America going bankrupt.

JuicedGamma's picture

Well then just stick your head in the sand.

Coke and Hookers's picture

I remember asking one of my Ph.D. econ student buddies at university what he thought of the current account deficit. Being a non-econ student, and therefore unenlightened, I wanted to benefit from his wisdom. Note that this was back in 1996 when the deficit was small compared to now. My buddy (who is now an econ professor at a very respected university) cleared his throat and said: "Well, a deficit means that more goods are coming into the country than are exiting it, so that's a good thing. It means that the country is getting richer." Since then the US has gotten very rich indeed.

Dr. No's picture

Actually he is right....if you measure wealth in property and goods.  We are exporting promises to pay (fiat) for durable goods, to be held in our possession.  The trick will be on a predetermined day, announce the fiat is no longer redeemable.  We can then keep all the goods without risk of some other country looking to spend all that fiat we exported.

Coke and Hookers's picture

Yes I know but this illustrates what these guys were being taught. They just looked at one side of the equation. They didn't take into account...

...that money is debt and increased debt results in devaluation and the transfer of real assets from the debtor to the debt holder.

...that account deficit is partly the result of less domestic-wealth creation and (later) the deindustrialization of the country.

...that imported goods amortise and lose their value while the debt incurred by their purchase grows.

... etc etc

What my friend was actually saying is that the country will get richer by creating less wealth. This is what they were taught and the model the economy was/is based on. Even if the fiat money were to be declared unredeemable at some point, the wealth imported would have lost most of its value and the nation would be poor AND unable to create wealth.

Dr. No's picture

My premis of getting richer by importing requires a sudden change in currency (break the contract).  Breaking the contract of course requires a big stick and is a very dishonest strategy; something you would expect from Dr. No, not a mainstream curriculum.

Coke and Hookers's picture

Well the contract IS being broken now by the devaluation of the dollar. As a bonus, the budget deficit will move all wealth from the slave class to the elite - both current and future wealth. This is a very dishonest strategy to say the least. Makes me think that some Dr. No may be in charge.