Economic Statistics for 8 Feb 13
The following US economic statistics were announced today:
Wholesale inventories fell -0.1% in December, while wholesale sales were unchanged, keeping the stock-to-sales ratio steady at 1.19.
The US trade gap narrowed in December, falling to -$38.5 billion, largely due to a big drop in iPhone imports, and increased exports. Exports rose 2.1%, while imports dropped -2.7%.
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Dale Franks
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At face value, Krugman is, sort of, correct .. the problem occurs when interest rate eventually have to rise.
With QE1, QE2 et al, the money supply is extended by having the Federal Reserve buying Treasury debt. When interest rates are finally eased, the larger the debt the faster the hyper-inflation.
Bottomline: if you follow the advice of Krugman, don’t be part of the party in power when the Fed starts to let interest rates “float.” You will be remembered as “the guys who made Jimmy Carter look good”
Apt metaphor: you don’t have a crisis when you put a gun to your head .. the crisis begins when you pull the trigger
In its latest Budget and Economic Update, the CBO forecasts that federal revenue will top $2.7 trillion in 2013, slightly higher than the $2.6 trillion the government collected in 2007, when the last recession officially began.
Government revenues had fallen by nearly $500 billion during the recession to $2.1 trillion in 2009, contributing to the $1.5 trillion deficit that year. However, federal revenues have been recovering since the recession ended in June 2009, and the CBO now projects that they will slightly eclipse their pre-recession peak.
http://m.cnsnews.com/news/article/cbo-federal-revenue-set-record-2013