America Now Borrows $2.5bn Daily to Fund Budget Gap
Aug 4th, 2008 | By Eric Roseman | Category: Featured, Financial NewsThe US now needs to raise $2.5 billion every day to fund its budget gap, says The Sovereign Society’s investment director, Eric Roseman.
This year’s fiscal deficit is expected to be 140% larger than last year. And the Treasury’s highest quarterly borrowing on record happened during the first three months of 2008.
Eric says the best way to protect your wealth in the face of massive US borrowing is to use any intermittent dollar strength to buy gold…
The United States Treasury could use a handout. They’re dealing with sharply lower tax revenues, two military campaigns and a struggling economy. In response, the Treasury spokespeople just announced it will quadruple its borrowing requirements for the quarter ending September 30.
Longer term, the country’s funding needs will require substantially higher interest rates. By all accounts, this borrowing is already running out of control. In fact, the borrowing binge is heading for the record books. The United States must raise about US$2.5 billion DAILY to fund its budget gap.
The United States Treasury estimates it will need to borrow US$171 billion for the third quarter – the second highest funding requirement on record. The highest borrowing binge occurred in the January to March period earlier this year when the Treasury raised US$244 billion.
The deficit for this fiscal year, which ends September 30, is projected to hit US$389 billion, up 140% from US$161.5 billion the previous fiscal year. The United States has not logged a budget surplus since 2000.
With borrowing like this, is it any wonder why gold is in a secular bull market this decade? Do yourself a favor: Use any intermittent dollar strength to buy gold.
Source: Treasury: ‘Could You Spare Another Handout America?’
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Eric serves as an editor and Investment Director for The Sovereign Society's Commodity Trend Alert. Eric's talents include blending a dozen or more alternative investment funds to produce consistent returns to traditional asset classes and making commodity based recommendations with huge upside and limited downside.
