As January is with Britain, so April is with America. That's to say, April is the usual month when the US Treasury receives its big annual lump of personal tax payments.
For the first time in history, the British government needed to borrow in January, and although it's not the first time that the American government has borrowed in April, this year's borrowing figure is a quadrupling of the previous worst (last year).
At least, that's what Addison Wiggin thinks.
And I tend to believe him.
But let's just think about that for a minute. Even in the month when the US Treasury receives its highest amount of tax revenues it borrows $175.6 billion, then even if we are spectacularly generous to them and assume that each month in the year receives the same amount of tax revenues, which is far from reality, then this borrowing figure can be annualised to $2.1 trillion dollars.
If we're particularly ungenerous, and assume that other months receive a lot less tax, as is actually the case, then this means that this year the US Treasury will be increasing the US debt by approximately $3 trillion dollars, or more.
And we're in a recovery?
I'd hate to see it if the double-dip actually hit.
Let's just hope those Chinese don't catch an economic cold and can keep buying all those bales of paper issued by the US Treasury. It should be some bonfire of vanities when they burn all of this worthless flotsam in about five or ten years' time.
No doubt the Federal Reserve will step in and take up the provisioning role, by buying up those bundles, if the Chinese fall away. Though at least the Chinese send ships to the Port of Los Angeles filled with real goods to swap them for US paper. What does the Federal Reserve use?
Oh, yes. Thin air.
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