Treasury Runs Largest August Deficit Ever as Interest Costs Soar


    by Peter Schiff, Schiff Gold:

    The Federal Government ran a $220B deficit in August which is the largest monthly deficit since last July.

    Looking historically at the month of August shows this month as the largest ever (red bar). Despite all-time record revenues for August, spending jumped from $439B last August to $523B this August, a YoY increase of almost 20%.

    TRUTH LIVES on at

    Figure: 2 Historical Deficit/Surplus for August

    The historical average for August is $147B, which makes this August 50% larger than the 10-year average!

    Figure: 3 Current vs Historical

    The Sankey diagram below shows the distribution of spending and revenue. The Deficit represented 42% of spending in the most recent month and was larger than both Social Security and Health combined!

    Figure: 4 Monthly Federal Budget Sankey

    The monthly figure was significantly larger than the TTM deficit 17.14% of total spending, or $1T of $5.8T.

    Figure: 5 TTM Federal Budget Sankey

    Total revenue increased some MoM, driven by a slight uptick in Individual Income Taxes and Excise Taxes.

    Figure: 6 Monthly Receipts

    Total Expenses for August were higher than July but below both June and April.

    Figure: 7 Monthly Outlays

    Perhaps the most important expense to take note of is Interest Expense. As explained in the debt analysis, interest costs have been soaring lately. Last August, TTM interest expense was $356B. That figure now stands at $465B or 30% higher in one year! Since July, TTM interest has increased by $21B.

    Read More @