Registered Investment Adviser Caleb Lawrence
The major averages struggled into the final hour mixed on little news As the Fed seems to have arrested the latest sharp market decline and recovered some of the lost ground once again. This will mark a 3rd time in the last 2.5 years.
With the latest Trump inspired tax cut in the books one would think that the Federal Reserve latest report on national finances would be newsworthy but apparently not. In addition to reducing revenue by about 150 billion per year it also increases spending by about the same amount, so the net deficit increases by some 300 billion per year. Highlights form the Federal Reserve report include a 1.16 Trillion Dollar deficit for fiscal 2017. Net costs are expected to increase 129 billion to 4.5 trillion. Tax and other revenues should gain 29.3 billion to 3.4 trillion. For the record costs are advancing at more than 4-times the rate of increase for revenues. The bottom line or Net Operating Cost difference is expected to jump 10% to 1.16 trillion. Despite all the talk of a “goldilocks economy” the “official national debt” has surpassed 20 trillion growing steadily during a period of supposedly healthy economic growth when it should have been falling thanks to rising tax revenues. Just another item to add to the list of things that just don’t matter along with the list of things we should be having a robust national discussion about, but don’t. Because the mainstream media doesn’t think its newsworthy.