Network analyst Pavel Spidel called the situation in the US financial markets an unprecedented cash gap:
“In just one month (April), the US federal budget deficit (738 billion) exceeded the average ANNUAL deficit over the past 7 years (660 billion), i.e. borrowing rates increased 15 times! In April, the US federal government spent (980 billion) FOUR times more than it earned (242). And the need to cover the budget deficit is THREE times greater than what they earn.
Government expenditures increased almost three times relative to the average for the last 4 years for the month of April.
Revenue fell 55% from 2019 and doubled from the average over the past 4 years.
Accordingly, the budget deficit amounted to 737 billion - this is more than my recent calculations (700 billion) in real time based on cash balances and transactions of the US Treasury.
It is important to note that in the USA in April historically there has always been a budget surplus, as the peak of tax payments by business and the public falls in April, therefore, if we consider the planned cash flows, the cash gap is not 737 billion, but closer to $ 1 trillion per month, because the expected surplus in April 2020 was supposed to be 180-210 billion dollars. It should have been, but did not make! In May there will be a real disaster, because in May, the planned deficit of about 150-200 billion, so in May 2020, the deficit could exceed a record 737 billion.
In real-time monitoring of cash flows, directions are encrypted, so earlier it was not possible to understand the final beneficiaries of such crazy expenses, but everything is visible in the monthly analytics.
We expect an income gap, corporate tax collections have fallen 10 times and corporate tax levies more than 4 times. However, the most interesting part about expenses. Almost all of the increase in spending is concentrated in only four destinations - Health (+51 billion), Medicare (+97), Income Security (+261), General Government (+144). The first two recipients are medical facilities and medical insurance. It turned out that for each hospitalized and those who examined in hospitals (about 300 thousand people from March to April), the federals unloaded an average of 500 thousand dollars with a crown! Actually less, because part of the costs went to general sanitary-epidemiological and diagnostic procedures, but the order of numbers does not change much. To emphasize the whole depth of the absurd! Good business - it’s understandable why the crown-hype and flash mob are so profitable?
Income Security is a grant, subsidy, subsidy of any form and type, with the exception of regular ones, which are due by age or length of service (Social Security category). Income Security includes unemployment benefits and one-time payments of $ 1,200 / 500 - this is precisely the reason for such an increase in expenses in this category. In the General Government category, cost increases are not atypical. Usually there are expenses for the Congress / Senate, the White House, tax and administrative federal services and various ministries. The annual cost of the circle is 20 billion, or an average of 1.5 billion per month. But now 145 billion is a transfer to states and local governments. Never in the history of the USA has the federal government straightened out the budgets of local authorities and in such volumes, this is a completely new experience!
There is another category that did not show a reaction in April, but will show from May - this is Commerce and Housing Credit, those same loans to business. But loans are said loudly, in the conditions of degenerate pseudo-capitalism in the USA there are no more loans, there are subsidies and subsidies.
To assess the degree of neglect.
This is a table of annual expenses and income for the fiscal year (October to September). The reaction to the financial crisis of 2009 was an increase in spending of 550 billion for the entire financial year (from October 2008 to September 2009), but revenues fell by 420 billion and the total deficit for the year increased by 1 trillion to 1.42 trillion. Once again, this is for the WHOLE year. And now, what most recently happened in a year, now happens in a MONTH, literally! In 2009, the entire TARP program and business support cost 293 billion, in this case it can go under 1 trillion only from the Treasury, not counting the Fed. Plus benefits, endless benefits.
Throw 1 trillion per month into the economy in excess of typical balances - we went cheerfully! Of the announced plans, the deficit in FY2020 (by September 2020) could reach $ 4.5 trillion!
And so the world that we knew ends..."