Budget Deficit Hits Record As U.S. Spends 100% More Than It Collects YTD

Those who have been following the record surge in US public debt (excluding the roughly $100 trillion in off-balance sheet obligations), which exploded by $3 trillion in the three months following the covid shutdowns and which hit an all time high $26.547 recently, will be all too aware that the US budget deficit this year - and every year after - will be staggering.

Sure enough, in the latest just released deficit report, the Treasury announced that in July the US burned through another $63BN, which however was a major "improvement" after the record $862 billion deficit recorded in June, as government receipts soared thanks to the July 15 tax date even as spending remained in the stratosphere.

Specifically according to the Treasury, in July, government outlays were $626.5 billion, an increase of 68.8% Y/Y from the $371 billion spent last July if 43% below the record June outlays of $1.1 trillion...

... while receipts jumped to the highest on record, surging 124.2% Y/Y to $563.5BN, up 132% from the $242.8BN in June receipts, which however was a one-time surge thanks to the July 15 tax filing deadline, and will promptly fade in the coming months.

The chart below shows the July 2020 breakdown between various receipts and outlays.

On a YTD basis, 10 months into the 2020 fiscal year, the US has spent $5.631 trillion and collected just $2.824 trillion, which means that YTD outlays are a record 100% higher than receipts, which also includes the $8.3BN received last month and $63.4BN YTD in deposits of earnings by the Fed.

And since outlays equal receipts plus the deficit, it will come as no surprise to anyone that in the first 10 months of fiscal, the US budget deficit is a record $2.807 trillion (compared to "just" $866.8 billion in 2019), higher than at any other time in US history and unfortunately due to "helicopter money" it is unlikely that the exploding deficit will ever shrink again until the monetary system is overhauled... or collapses.

At some point the market will realize that this insanity is simply unsustainable. And, in fact, looking at the soaring price of gold recent very temporary downdraft notwithstanding, that realization may not take too long.