원문 보기
all right we have more changes unfolding in the US economy and over in the swamp of Washington DC changes that have Congress reaching a deal on how much to spend for 2024 all this just happening over the last few days as times running out the deadline is now January 19th the official deadline at least the unofficial deadline is apparently February 3rd that's when the treasury really runs out of money when their TGA the treasury general account reaches zero so we'll look at this deal what's in it how much it really costs and what this means going forward as the amount of borrowing continues to soar what will this mean for interest rates this year how will bond markets react with all of this new borrowing that the treasury needs to put together we'll look at it along with a special message from one of the most respected investors not even a message more so a warning to the FED to Jerome Powell and to Amer amans in general this is Jeffrey gunlock coming out warning how something has to change and quickly as the path that we're on the amount of borrowing that we're doing at these interest rates is just unsustainable explaining why he thinks in the coming years we could reach a point of no return but before we get started press the like button subscribe share the video with a friend all of that helps out also check out our new Daily Show over on the notify America YouTube channel Congress has a agreed on a new bipartisan budget deal for 2024 the Speaker of the House Mike Johnson announced the news on Sunday saying it's a $1.66 trillion bipartisan package to avert a government shutdown the deal will set aside $ 8863 billion for defense spending and 7727 billion in domestic discretionary spending and every time I see one of these budget deals and it shows more money for the military than what we spend at home it just boggles the mind now at the moment this is completely bipartisan at the leadership level so Senate Majority Leader Chuck Schumer Mitch McConnell are both on board as well as Mike Johnson and AEM Jeff the White House is also supporting the bill notably it doesn't provide any new funding for Ukraine or for Israel something that could make it easier to get past as Democrats want funding for Ukraine Republicans for the most part don't however this package is the same funding package that Biden and McCarthy agreed to last year before House Republicans voted McCarthy out but what's funny about all of this and annoying is everything that happened a few months ago when McCarthy was voted out as speaker because of the budget deal at least partly because of the budget deal how he capitulated to the Democrats into Biden well it turns out the new Republican speaker used the exact same deal more or less so all of those Shenanigans were for nothing last year we'll keep an eye on this as the official deadline is January 19th The Unofficial deadline is allegedly February 3rd that's when we really run out of money when the treasury's bank account their TGA hits zero but along with this after they draft the bill vote on it sign it into law treasury begins the process of scheduling the auctions to borrow this $1.66 trillion it's a whole lot of borrowing here's our national debt right now $ 34.010659 nothing CU according to the CBO over the next 30 years they projecting federal debt will double you could see it on this chart this is federal debt held by the public they say this over that period the growth of Interest costs and mandatory spending outpaces the growth of revenues and the economy driving up debt those factors persist Beyond 2033 pushing federal debt higher still to 195% of GDP in 2053 completely unsustainable and what makes it worse and possibly part of the reason why the FED is all of a sudden so gung-ho on cutting rates is maybe they're receiving pressure from treasury or from the White House's interest expense on this debt is expensive so expensive it's mindboggling just the cost to service our national debt currently has crossed a trillion dollars that means just the interest expense alone is a trillion dollars a year think about that how can we afford all of these domestic programs that all these politician are promising or promoting when we're spending this kind of money on interest which is another reason the FED needs to cut the night rate and fast now is anybody actually watching this is there anyone in government who's telling Jerome Powell behind the scenes that this is unsustainable we have to cut rates because we're spending all of our money on interest alone I don't know I have no idea if anyone is working in the background to this effect or if anyone even cares I hope someone does I hope someone is but I don't know take a listen to Jeffrey gunlock in an interview he just did with Tucker Carlson listen to what he says about this watch it is interesting that that that pivot that you mentioned is so radical yes I I think that what's going on is that interest rates have uh Fallen at the long end of the maturity Spectrum so 10year treasuries 30-year treasuries and they fallen into the point that they're well below where the FED has short-term interest rates and the FED almost always takes notice of that and it's gotten to be pretty extreme and so that's one of the major factors I think that they're aware of history and the way that the interest rate cycle works so I think that's that's a big piece of it I also think that the FED is noticing that the inflation data uh is moderating to a point that's getting close to what they hope to achieve what I mean by that is they there's all these different inflation indices the CPI the PPI the pce you can almost pick anyone you want but if you look at the one that the FED uses the most which is the pce personal consumption expenditures they if you take a look at recent months and annualize them they're basically right at the fed's Target and so inflation went up much faster than they expected back a couple of years ago and they were tardy in raising interest rates they should have raised them much soon sooner so inflation actually on the CPI got to over 9% on the high which is sort of Jimmy Carter esque yeah and so they had to go into radical interest rate increases but one thing that is lurking beneath the surface and I think this is the primary variable is there is an enormous amount of debt that the treasury has to refinance over the next three years there's there's $34 trillion of national debt which is shockingly high and it was facilitated the fact that the FED kept interest rates at zero for such a long time yeah when interest rates are at zero you can borrow an infinite amount because you have no interest expense but all of a sudden interest rates are up by five and 38 perc or five five and a five and a half percent and now we have $17 trillion dollar of treasury debt that's maturing in the next three years and if interest rates stay where they are it's going to cause a tremendous squeeze on Revenue because already we have a high percentage of interest uh of of tax receipts that go to interest expense and it would go much much higher the CBO the Congressional budget office projects where deficits are going and where where uh interest expenses going and all that stuff but their assumptions are no longer really valid they they assume that the the national deficit will be at around 3 or 4% of GDP well it's already above 6% of GDP and we're not even in recession right they also assume the interest rates will stay at around 3 or 4% and they're they're starting to get to 3 or 4% type of level but they were up at five and a half percent or 5% and if you just do the arithmetic you start to realize that the percentage of tax receipts that will go to interest expense becomes completely untenable in fact if you uh assume that we continue to have 6 to 8% deficit percent of GDP which is almost a certainty the way this economy is running and you keep interest rates where they are it it's in about five years you have something like it depends what interest rates you assume but you you have something like 30 40 even potentially 50% of all tax receipts going to interest expense this is a really big problem because we have such a large amount of expenditures that are mandatory we don't have the we don't have the money right to to to have interest expense that high and so I think beneath the surface the FED is looking for reasons to same mission accomplished in a certain sense by taking the last three to six months of inflation data annualizing it and saying well maybe we don't need interest rates this high and maybe we have to worry about this this problem now another interesting point that shows the sheer in competence of our Treasury Department is how they organized the auctions a few years ago realize treasury decides what types of bonds and notes how many they want to auction off well a few years ago when we had Rock Bottom interest rates Janet Yellen decided to increase the quantity of notes instead of bonds notes are shorter term borrowing borrowings bonds are longer term so we were borrowing all of this money at say one or two points barely nothing but we only locked it in for 5 years instead of ramping up longer term bonds auctioning off 30s or 20s maybe they decided to auction off short-term notes now those short-term notes are beginning to mature and we have to rebor the money at 5% interest think about that
댓글 0