The U.S. fiscal situation never ceases to amaze us here at forsoundmoney. With that in mind we have looked at some very interesting data and comparisons.

Back on April 25th, 2000 the U.S. national debt stood at $5.739 trillion while as of April 25, 2012 it stands at $15.68 trillion or 273% higher. Back on the same day in 2000 the U.S. governemnt was running an annualised budget surplus of $159 billion while today the government is running a budget deficit of $1.325 trillion. Federal income tax receipts for 2000 was $918 billion while today it is $178 billion higher at $1.096 trillion while corporate tax receipts have decreased from $192 billion in 2000 to $177 billion today. CPI was running at an annualised rate of 3% back in April of 2000 while the latest CPI data this year (March) was running at 2.7%.

It would be interesting to ask Rip van Winkle, if he had been asleep since April 2000 and woke up today and had analysed the above-mentioned data, what he thought the U.S. Treasury 10-year yield would be today considering it was at 6.12% when he embarked into his long sleep! I guess we could give him a multiple choice question: "Where do you think the 10-year yield is today?" A) 12.63% B) 8.25% C) 16% D) 1.98%.

Well the answer to the question is 1.98% and it makes one wonder if Mr van Winkle would have asked how much longer financial markets can remain irrational for?"

By Mario Innecco
ForSoundMoney.com

At ForSoundMoney we stand for a hard currency. We believe in a monetary system based on commodity money and a free-market banking system where central banks are non-existant.

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