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U.S. Debt

Government forecasters are warning the U.S. budget deficit will more than double as a share of economic output by 2040 if current tax and spending laws remain unchanged. On Tuesday June 16, the Congressional Budget Office (CBO) released the 2015 Long-Term Budget Outlook. (Source: The Congressional Budget Office,…

Something just doesn’t make sense here… In 2013, the U.S. budget deficit came down to $680 billion. Finally, after four consecutive years of annual budget deficits of more than $1.0 trillion, the government got its annual “hole” under the trillion-dollar level, and it seemed as though we were…

Can it be true? The U.S. Department of the Treasury has reported that for the federal government’s fiscal 2013 year, which ended on September 30, 2013, the U.S. government budget deficit was $680 billion—the smallest budget deficit in five years. (Source: Bureau of the Fiscal Service, October 30,…

The U.S. government, after winning World War II for the Allies, was very convincing. It told central banks around the world that they should hold the U.S. dollar as their reserve currency instead of gold, based on the idea the U.S. dollar would be backed by gold. Only…

The stock market…a place where rationality has been thrown out the door in favor of trading for immediate profits…profits based on what the government and Federal Reserve are planning to do next. It’s no longer a place for average investors to make money, as the fundamentals that drive…

The biggest economic center in the global economy, the U.S., showed dismal growth in the last quarter of 2012. Sadly, the first quarter of 2013 is looking to be the same. Demand in the country is anemic at best as consumers are struggling. New durable goods orders in…

A report from Standard & Poor’s (S&P), the credit rating agency, indicates there is more than a one-third chance that Japanese sovereign debt could face a downgrade. The report stated, “…the continuing prospect arises from risks associated with recent government initiatives and uncertainty of their success.” (Source: Janowski,…

As the key stock indices approach highs not seen since just before the financial crisis, the underlying fundamentals are screaming “watch out.” The stock market could be edging higher on nothing but false optimism and greed. The most basic reason for any stock market rally, corporate earnings, is…

The Congressional Budget Office (CBO) expects the U.S. federal government to have a lower budget deficit this year than those of the previous four years—finally getting the annual deficit under $1.0 trillion (although, not by much). But I am skeptical when it comes to the CBO estimates, as…

U.S. bonds could be entering dangerous territory. According to Bank of America Merrill Lynch indices, 30-year U.S. bonds have declined more than five percent so far in 2013. Their decline in January 2013 was 4.3%—the biggest monthly decline since March 2012. (Source: Bank of America Merrill Lynch, February…

Gold and silver are currently taking a breather on the charts, but if the global risk holds, I wouldn’t be surprised to see a rally in the precious metals this year. I can see gold breaking to $1,800 an ounce, something that nearly materialized on October 5, 2012,…

Happy New Year to our Profit Confidential readers! In 2012, small-cap stocks were the second-best performing group, following the technology sector. The Russell 2000 was the top performer in December and has been since the end of the first quarter. How the small-caps fare this year will, again,…

I’m worried about U.S. debt (which this morning surpassed $16.3 trillion) and I’m concerned it’s going to increase even further. We all know that, since the financial crisis hit in 2008, U.S. debt has skyrocketed. Now with cities and states across the U.S. struggling with their budget deficit…

On the eve of the presidential election, the world and America are anxiously waiting to see whether President Obama or Governor Mitt Romney will become the 45th U.S. President. The outcome of Tuesday night will be critical not only for the direction of the country on both the…

When consumers are cautious, they tend to hold back on any major purchases, such as homes, vehicles, furniture, appliances and travel, to list a few. This will impact spending and gross domestic product (GDP) growth and the ability of companies to expand their businesses and hire new employees,…

The debt and growth problems in the eurozone continue to dominate the headlines. The eurozone countries are looking at the impact of Greece exiting the 17-country eurozone. Greece can’t even elect a coalition government to deal with the austerity measures. Now there’s news that the eurozone is continuing…

Gold prices have been all over the chart and moving in a sideways consolidation channel since late September, caught between $1,800 on the top end and $1,550 on the bottom. After a recent move towards $1,800 in late February, the metal topped and is again struggling to hold…

China is aiming to land an astronaut on the moon sometime after 2020. For the time being, the country is building a massive war chest that includes a whopping $800 billion or so in U.S. debt. But the country, unlike the U.S. and Europe, is clearly not hurting…

In spite of the eurozone mess, U.S. markets appeared to have forgotten about the severity of the chaos in Europe, instead focusing on a good jobs report and domestic renewal. January began with a bang, with the NASDAQ up close to five percent before some selling surfaced last…

Happy New Year! In 2011, small-cap stocks lagged blue-chips and large-cap stocks following a strong 2010. In my market view, the big difference in 2011 was the uneasiness of the economic renewal in the U.S. and global economies. And, despite a positive January 2011, stocks largely fell last…