[Guest post by DRJ]
The good news is that Ben Bernanke said today the economy is on the verge of recovery, forecasting a return to growth in the “near term.” The bad news is that the White House acknowledged the 10-year budget deficit will be $9.1 Trillion — $2 Trillion more than originally projected:
“The $2 trillion revision, first reported by Reuters, stems from new data that showed the downturn was more severe than previously known, an administration official told Reuters.
The new forecasts are based on new data that reflect how severe the economic downturn was in the late fall of last year and the winter of this year,” the official told Reuters, adding that the new projections “are now in line with the spring and summer projections that the Congressional Budget Office put out.”
Also next week, as has been previously reported, the administration will revise its annual budget deficit projection for this year down from $1.84 trillion to $1.58 trillion, since less money than once anticipated has been needed to stabilize the financial system.
Still, the rising debt has caused increased concerns among key foreign lenders like China, which in June reduced its holdings of US assets by around $25 billion.”
I’m starting to really dread Friday afternoons.