- Debt Ceiling Deal raises Ceiling by $4 Trillion.
- No Real Cuts.
- No Balanced Budget.
- No Plan to keep Federal Debt from spinning out of control.
- US Debt is $32 Trillion
- Federal Annual Tax Receipts $4 Trillion
- Federal Annual Deficit $1-1.5 Trillion
- US Economy $24 Trillion Nominal GDP
- Unfunded Social Security $23 Trillion
- Unfunded Medicare $35 Trillion
No easy Fix
Reducing Social Security and Medicare politically impossible. The Federal Reserve restarting QE (Quantitative Easing) and buying the US debt to keep rates down. QE is the most likely choice and will be wildly inflationary. Recession seems to have started in the second quarter. QE will most likely be used to restart the economy once the recession has caused enough pain.
Staying cautiously positioned and poised to pivot.