There is a correlation between what the government receives in taxes (blue chart), and the savings rate (red chart). When the savings rate makes a bottom, this coincides with a top in tax revenue.
The savings rate just dropped to 4.2% from 4.5% and this will eliminate all hope that tax revenue will continue its increase. What this also means is that the deficit will likely continue to increase.
We already see this happening in the budget deficit, which has increased again (yellow chart). An increased deficit will weaken the U.S. dollar and put pressure on U.S. bonds (higher yields). With this information, you can prepare accordingly.
We already see this happening in the budget deficit, which has increased again (yellow chart). An increased deficit will weaken the U.S. dollar and put pressure on U.S. bonds (higher yields). With this information, you can prepare accordingly.
Hi Albert, I like the post on tax revenues however on the US Dollar I think it will get stronger only. Jim Rogers says he is buying USD even though he doesnt like it.
BeantwoordenVerwijderenMaybe Jim thinks the tapering will weaken stocks and that's why people will get into bonds and cash again. I'm not sure though.
VerwijderenBy the way, your feed on Jim Rogers not working. can you pls add it again
BeantwoordenVerwijderenJim Rogers: www.jimrogerblog.com
Feed url: www.jimrogerblog.com/feeds/posts/default
Wow, I didn't think anyone would pay attention to the links. I updated it and I feel that this new Jim Rogers blog is better than the old one. Thanks!
VerwijderenHi Albert, thank you,it looks good now.
VerwijderenMerry Xmas to you and your family.
Cheers
Rick