Thursday, November 12, 2009

Spending Down + Deficit Up = Not Good

Bloomberg reports:

The U.S. budget deficit widened in October from a year earlier, reaching a record for that month, as rising unemployment cut revenue at the start of the first full fiscal year under President Barack Obama.

The excess of spending over revenue widened to $176.4 billion last month, compared with a deficit of $155.5 billion in the same month a year earlier, the Treasury Department announced today in Washington in its monthly budget statement. It was a record 13th consecutive shortfall and the fifth-largest monthly gap on record, the department said.

The issue may be that outlays are reduced (non-stimulating) and the deficit still grows due to the collapse in revenues. That my friends, would be a lose-lose for the economy.

Source: Treasury