Spending Cuts Are A Game of Perception

Political posturing over crumbs of much larger deficit pie is nothing more than a game of perception. The Formula below illustrates the depth of the problem in which the solution fools only the fools. Meanwhile, few have noticed a roll over in the Formula in 2011. This debate will go silent once the motivation to do something passes.

US Federal Budget (Surplus or Deficit As A % of GDP, 12 Month Moving Average) and Gold London P.M. Fixed:


Headline: Spending cuts not expected to dent $1.5T deficit

The $38 billion in spending cuts agreed to last week won't prevent this year's budget deficit from setting another record high, estimated at $1.5 trillion.

Most of the agreed-to spending cuts either affect future budgets or amount to accounting gimmicks that won't reduce actual spending.

The Treasury Department reported Tuesday that the deficit already totals $829.4 billion through the first six months of the budget year -- a figure that until 2009 would have been the biggest ever for an entire year. For March alone, the government ran a deficit of $188 billion.

Source: finance.yahoo.com