US Corporate Profits Fall, US Government Deficit Rises
The federal government last month recorded the biggest monthly budget deficit since February, and the deficit so far this budget year is running 10% higher than a year ago.
The US Treasury Department said Wednesday that the deficit came in at $112.8-B in July, highest since February’s $192.6-N but down from $149.2-B in July 2015. For the 1st 10 months of the budget year, which ends on 1 October, the deficit was $513.7-B, up from $465.5-B a year earlier.
The government runs a deficit when it spends more than it collects in taxes and other revenue.
So far this budget year, government revenues are flat to unchanged from a year earlier but spending is up 2%. Spending rose on interest payments and Medicaid.
Revenue from corporate taxes is down 12% YTD, reflecting a fall in business profits.
The Congressional Budget Office predicts the Y 2016 deficit will total $590-B, up from last year’s budget gap of $439-B, largely because of lower-than-expected revenues.
Accumulating budget deficits add to the federal debt, now nearly $19.4-T. That figure includes $5.4-T the government owes itself, mostly from borrowing from the Social Security trust.
The Center for a Responsible Budget estimates that Hillary Clinton’s budget plan, including an expansion Barack Obamacare (the Affordable Care Act), would add $250-B to the debt over a decade.
Wednesday, the US major stock market indexes finished at: DJIA -37.39 at 18495.66, NAS Comp -20.90 at 5204.58, S&P 500 -6.25 at 2175.49
Volume: Trade was light again, with about 745-M/shares exchanged on the NYSE
- Russell 2000 +7.7% YTD
- S&P 500 +6.4% YTD
- DJIA +6.1% YTD
- NAS Comp +3.9% YTD
|HeffX-LTN Analysis for DIA:||Overall||Short||Intermediate||Long|
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|Bullish (0.38)||Bullish (0.35)||Bullish (0.29)||Very Bullish (0.50)|
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|Bullish (0.29)||Neutral (0.07)||Very Bullish (0.58)||Neutral (|
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