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In order to abolish any doubts that a massive economic downturn is just beginning, the Wall Street Journal reported that the US Department of Treasury plans to borrow $3 trillion in order to deal with the COVID-19 fallout.
This sum would be borrowed in during the April-June quarter to deal with the coronavirus pandemic.
It’s an unprecedented level of deficit financing to match the historic economic hit caused by the virus. In a single quarter, the government will borrow more than twice as much as it did all of last year.
In total for the fiscal year, the entire plan sits at borrowing $4.5 trillion.
“The increase in privately-held net marketable borrowing is primarily driven by the impact of the COVID-19 outbreak, including expenditures from new legislation to assist individuals and businesses, changes to tax receipts, including the deferral of individual and business taxes from April-June until July, and an increase in the assumed end-of-June Treasury cash balance,” a statement by the Treasury said on May 4th.
The borrowing estimate is USD 3,055 billion higher than what was announced in February this year, the US Treasury said.
During the third quarter, Treasury expects to borrow $677 billion in privately-held net marketable debt, assuming an end-of-September cash balance of $800 billion, the statement said.
During the first quarter, Treasury borrowed $477 billion in privately-held net marketable debt and ended the quarter with a cash of $515 billion, it said.
Meanwhile, with the economy cratering and unemployment climbing to levels not seen since the Great Depression, Congress has authorized trillions of dollars in relief payments, unemployment benefits and loans to small businesses, as well as money for vaccine research and coronavirus testing.
To ensure that the borrowing costs remain relatively low, the Federal Reserve vowed to buy as much Treasury debt as necessary to face the consequences of the pandemic.
“This is the time to use the great fiscal power of the United States to do what we can to support the economy and try to get through this with as little damage to the longer run productive capacity of the economy as possible,” Federal Reserve chairman Jerome Powell said. [pdf]
Powell described himself as someone who has long argued against runaway federal deficits.
“But this is not the time,” he said, “to let that get in the way of us winning this battle.”
The Federal Reserve has cut its benchmark fed funds rate close to zero and purchased almost $2 trillion in Treasurys and mortgage related assets.
It has announced nine lending programs to lend another $2 trillion to calm all corners of the financial markets. As a result, the Fed’s balance sheet has reached a record $6.6 trillion, up from $4.2 trillion in February.
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All the fake zeros,hake heros,fake currency,fake bonds,fake excuses combined ain’t gonna save the usa (period) What we got is a world record failed capitalist system with no provistions to real metals, that’s where the future is,real markets,backed by real currencys,real produce in real time,so be it! Here we got more equirable nations @ 12th usa population reliance in several billions to reignite industrys across the board (do the real maths) and to think these useless,dumb reformists of nwos are gonna save civilisations,this is not looking good for usa at all,in short they gone all fkd,living only in borrowed time with borrowed moneys than frankly doesn’t even exist,usa must head to gold standards!
Real millions,real works,real billions far outperforms their fake trillions in each and every respect,liar$
Wow. Phenomenal plan from our chief financial wizard (((Treasury Secretary Mnuchin))). Except he over-Khazared and can’t seem to stimulate the ‘required’ amount of inflation to make his thievery disappear. At some point, the little people just say to hell with it and lose all incentive to produce much of anything. Which will be a problem for Mnuchin’s tax hikes and severe austerity measures for US debt slaves to be rolled out after the elections.
This is the minimum deficit this year. It could be higher depending on how the depression in the US progresses from the economic shutdowns. The shutdown state governments and the US government are rapidly careening towards bankruptcy.
– U.S. deficit to soar to record $3.8 trillion in 2020, budget watchdog group says –
https://www.reuters.com/article/us-health-coronavirus-usa-budget/u-s-deficit-to-soar-to-record-3-8-trillion-in-2020-budget-watchdog-group-says-idUSKCN21V1TA
Protocol No. 21
“11. We shall replace the money markets by grandiose government credit institutions, the object of which will be to fix the price of industrial values in accordance with government views.
These institutions will be in a position to fling upon the market five hundred millions of industrial paper in one day, or to buy up for the same amount.
In this way all industrial undertakings will come into dependence upon us. You may imagine for yourselves what immense power we shall thereby secure for ourselves . . .”
— The Protocols of the Learned Elders of Zion
us debt—30 trillion $$$—a fake economy that produces nothing imports everything…the empire now collapsing—-amerikans will lower expectations…soon their hamburgers will be half sawdust and cockroaches “the people of north amerika tolerate a level of ugliness in their daily lives nearly without precedent in the history of western civilization”. Yuri Bezmenov
Lol from a 19.6% deficit projected now, to 30%+. Basket case.. But the dollar will get stronger, even though the US is firmly beyond where Greece was when it got ran on by the vultures. Guess it takes a bit more incentive for them to eat their own young!