Unleaded gasoline futures courtesy of Trading Economics

Pay Down the Debt

US Pres. Biden: On Track To Reduce Deficit By $1.7 Tln
- Tsy Dept Planning To Pay Down National Debt This Quarter

— LiveSquawk (@LiveSquawk) June 3, 2022

Well Positioned to Overcome Inflation

BIDEN: WE ARE ON TRACK TO REDUCE DEFICIT BY $1.7 TRILLION

BIDEN: THE TREASURY DEPARTMENT PLANS TO PAY DOWN THE NATIONAL DEBT THIS QUARTER

BIDEN: THE US IS WELL POSITIONED TO OVERCOME INFLATION

— critical mix theory  (@allidoismix) June 3, 2022

Planning to Pay Down National Debt This Quarter

If tax revenues for the quarter exceed spending for the quarter, it's automatic. 

Planning is irrelevant. 

What About the Full Year?

On May 25, The New York Times reported The U.S. budget deficit is projected to fall to $1 trillion in 2022.

The United States is expected to record a $1 trillion budget shortfall this year, down from $2.7 trillion in 2021, marking a return to the economy’s prepandemic trajectory. 

Let's not confuse a declining deficit with actual debt repayment. The deficit is about $1 trillion.

Dear President Biden: It's not possible to pay down debt while incurring deficit spending. 

Moreover, the national debt will actually rise more than the deficit because accounting gimmicks understate the true deficit.

Flashback Hoot of the Day

House Speaker Nancy Pelosi from YouTube video clip, annotations by Mish

Here's the flashback hoot of the day. On March 12, 2022,Nancy Pelosi said  "Government Spending Reduces Debt". 

Well Positioned to Tackle Inflation

The price of oil rose another two percent today topping $119. 

Unleaded gas futures hit a new record high. The price of gasoline will follow.

Feel Confident

BIDEN SAYS AMERICANS SHOULD FEEL CONFIDENT ABOUT THE ECONOMY

— *Walter Bloomberg (@DeItaone) June 3, 2022

Translation: "I desperately need you to keep spending."

What a collective hoot. 

Expect a Deep Recession to Start This Quarter or Early Third Quarter

Yesterday, I commented Expect a Deep Recession to Start This Quarter or Early Third Quarter

That triggered a silly discussion regarding June is the end of the quarter. Yes, that's true but most key data is still from April.

The key number is retail sales. The most recent data is April. It was way stronger than expected. But is it believable?

For discussion, please see Is a Recession On the Way or Has it Already Started