If stimulus worked, then why isn't it? The US has $1 trillion deficits for four years in a row. If that's not stimulus, what is? Since it isn't working, the next question is how are we going to pay for it?

While pondering those questions, please note US runs a 4th straight $1 trillion-plus budget gap.

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Mike Shedlock

Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.

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12 Comments So Far
dpaul998 Wrote: Oct 15, 2012 12:01 AM
just as Wanda responded I can't believe that someone can profit $6088 in one month on the computer. did you see this webpage ??? Green32.com

???DO NOT FORGET TO CHECK OUT THIS LINK???
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Blair31 Wrote: Oct 14, 2012 8:45 PM
Time to cut the deficit by $10 trillion dollars, privatize Social Security, Medicare, and Medicaid, and adopt the Chilean Model.
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Floyd35 Wrote: Oct 14, 2012 2:56 PM
The latest prediction by Bank America is we will have a $$$$ 28 trillion dollar debt $$$$ by 2018. Democrats at work. They love to make slaves our of the mindless. Unfortunately they also make slaves out of those who know better as well. If we don't get those idiots out of there we are in big trouble. GET THAT CHAIN OFF OF ME. give it to one of those who voted for OBAMA and BIDEN!
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loadstar Wrote: Oct 14, 2012 1:01 PM





The ObaMessiah's support has always been an inch deep. Only the Sheeple could be truly upbeat about such a TERRIBLE record.

If we had a truly objective, questioning media, they would be RIPPING the guy!

But instead, the PC media has been shamelessly and shamefully in the tank!

It looks like Romney should win comfortably. The Obamanators cannot fool so many people this time...the Pied Piper of unwanted change should be toast-- the Wizard Of Ozbama has been exposed as the hollow guy behind the curtain of unfulfilled promises.
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Paulus Textor Wrote: Oct 14, 2012 12:06 PM
Excellent article by Shedlock.

One very, VERY deceptive practice government economists use is a Gross National Product (GNP) number that INCLUDES government spending as part of GNP.

This is problematic, for many reasons. Let's say the government spends 10 billion for bombs and missiles it uses to invade and occupy country X. It adds that 10 billion to the GNP figure.

Let's say also that the government spends 10 billion on transfer payments to poor people, and add that to the GNP.

Do either of those numbers really indicate an improvement in the economy as a whole? In both cases, the numbers were just subtracted from the free market sector, and transferred to the government sector. Nothing has been "added" to the GNP.
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loadstar Wrote: Oct 14, 2012 1:06 PM
I understand your point, but would argue that defense spending is FAR more likely to have a multiplier type effect and productivity period than welath transfer welfare spening that The One loves so much.

Defense spending employs the educated, fosters research, and creates things other countries will buy from us at great expense/value.

The War On Poverty (> $16 TRILLION to date!) mostly pays for liquor, lotto tix, drugs, potato chips, etc.
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PhillupSpace2 Wrote: Oct 15, 2012 12:44 AM
Yes, how else do inner city kids eat enough to become obese. Isn't it still a matter of calory intake per pound of fat? Is it possible to suspend the laws of physics just because it reflects badly on Minorities?

Welfare money is pure consumption! It produces nothing but sewage.
Americans becomming more stupid each year has to be by design. Ignorant people are so useful. They have now been convinced that the cost of Government is no longer an "Overhead, burdensome fact of life but have now been told it is PRODUCING something economicly desirable!

You know, 22% of people believe in the supernatural (It's not just Hillary and Shirley McClain any more!) Thats half the people who think Government spending will make the nation prosper.
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PhillupSpace2 Wrote: Oct 15, 2012 12:52 AM
With Government spending counted as GDP we only need the Government to spend enough and GDP will look very healthy. Itr wouldn't matter if anyone else lifted a finger, our credit rating would be great because GDP was on the rise!
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FletchforFreedom Wrote: Oct 14, 2012 10:25 AM
At some point an uneducated Obama supporter (but I repeat myself) will attempt to blame the deficits under Obama on Bush, specifically on either a) two wars or b) tax cuts. This merely demonstrates that Obama suipporters are incapable of doing basic math. The "cost" of the tax cuts was negligible (wait for reference to the fanciful OMB numbers to confirm their stupidity) and the cost of the wars during Obama's tenure comes to less than 14% not of military spending, not of overall sopending but of the annual deficits under Obama - the other 86% is ALL his.
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MoreFreedom Wrote: Oct 14, 2012 11:57 AM
Tax cuts don't cost money as liberals claim, they actually save taxpayers money. They may or may not reduce government revenue. Tell liberals that spending costs money, and tax cuts save us money. That, at least, is understandable. The "tax cuts cost money" is absurd, as it implies that tax rates of 100% cost nothing.
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Derek85 Wrote: Oct 14, 2012 9:01 AM
The Total Income Tax collections are only $865 billion (2009-last year reported) and our deficits are running $1.35 Trillion. If we told EVERY WAGE EARNER to double their taxes it would not be enough to offset our deficits. The Total Taxable Income of everyone who makes over $100,000 is just a little over $1.5 Trillion and this group already pays a majority of our income taxes. If we taxed them at 100% IT WOULD NOT BE ENOUGH.

The only reason the deficit is down slightly is because Obama has done everythig possible to get the banks to repay TARP loans which he is counting as INCOME. Obama is counting the loans as spending against Bush but income towards his fiscal year when they are repaid. Talk about Fuzzy Accounting
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Greg1084 Wrote: Oct 14, 2012 7:34 AM
The bad money helps them that touch it first: bankers and political cronies. End the Fed. Repeal the legal tender laws, and allow free banking.
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