These Pictures are Worth a Trillion Words…

Take a look at this chart…

Source: St. Louis Federal Reserve

That’s the total of the federal public debt… the cumulative amount the government has overspent over the past decades. We were never what you’d call “fiscally responsible” but the explosion in deficits that add to the debt took off during the Reagan administration (sorry… but it’s true) and has never looked back.

Now take a look at this one…

Source: St. Louis Federal Reserve

This is the federal debt held by Federal Reserve banks. This is the amount of debt the Fed has monetized by purchasing it directly from the Treasury. It’s roughly $5.6 trillion. It’s doubled in the last two years and has increased by roughly a factor of 10 since 2000. 

This one should be no mystery…

Source: St. Louis Federal Reserve

This is M1 or the money supply. (According to the Fed’s 2020 redefinition it includes cash, checking accounts, other liquid deposits along with savings deposits.) It’s the result of that broken money spigot currently flooding our economy with inflation.

Now take a look at this

That’s the bottom right corner of the U.S. Debt clock. It shows you what the country’s REAL debt is. It’s the amount we owe when you add unfunded liabilities like Medicare, Social Security, VA and federal employee benefits to the public debt. 

That’s over $159 trillion. (It’s probably higher by now…)

It’s hard to fathom the kind of fiscal irresponsibility it takes to OVERspend your budgets by $159 trillion.
Now check out this headline from the Wall Street Journal this week…

The Secretary of the U.S. Treasury has just informed the Congress that the country has once again overstepped any semblance of fiscal responsibility maxed out our borrowing ability. 

One of the key factors bumping us up against this debt limit, is part of the $1.2 trillion bi-partisan spending bill President Biden just signed into law this week.

‘A transfer tied to President Biden’s signing Monday of a $1 trillion infrastructure bill could leave the Treasury short on cash. The law instructs the Treasury to move $118 billion to the Highway Trust Fund, which Ms. Yellen said would happen Dec. 15.

“While I have a high degree of confidence that Treasury will be able to finance the U.S. government through December 15 and complete the Highway Trust Fund investment, there are scenarios in which Treasury would be left with insufficient remaining resources to continue to finance the operations of the U.S. government beyond this date,’ she wrote.”

The Congressional Budget Office (CBO) has officially estimated this bill will add $256 billion in deficits over the next 10 years.

Infrastructure is already costing us dearly.

(In what might be considered some encouraging news, the U.S. Treasury’s website tells us, “Since 1960, Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit – 49 times under Republican presidents and 29 times under Democratic presidents.”)

For over 60 years, our legislative branch has displayed a stunning incompetence when it comes to fiscal restraint. (Or, more likely, they just don’t care.)

And now this…

This was the pitch the president along with some of his talking heads made when pushing his $3.5 trillion social spending “human infrastructure” bill.  (The real cost is $5 trillion or more, according to an independent analysis by the Committee for a Responsible Federal Budget, which keeps an eye on fiscal matters.”)

Today that program has, through governmental “mathe-magical” gimmicks, been whittled down to somewhere in the neighborhood of $1.75 trillion — although no one still seems to know what all exactly is in the bill. 

This kind of claim is nothing new.

I assure you, every congress which has passed one massive spending bill or another has promised us that the text of the law always contains “pay fors” —  methods to cover the cost of the programs.

And yet here we are…

$159 trillion in debt!

I’ll be honest, it’s not the reckless spending that irritates me… It’s always easier to spend other people’s money.

What gets me is the utter arrogance and disdain… The amazing audacity with which the government lies to us.

(And frankly I’m also insulted by how stupid Washington thinks we all must be to buy their nonsense.)

They drown you in inflation and then tell you it’s “transitory” or that “it’s proof the U.S. economy is doing great” 

They bury our country under a mountain of debt and insist that somehow it’ll all get paid.

This isn’t a left or right issue. This is a Washington DC issue.

So if you ever wonder why Wall Street has so little regard for the individual investor… Why they’re so driven to rake in profits even at your expense… 

It’s because these guys are in charge!

Make the trend your friend,

Bob Byrne
Editor, Streetlight Confidential