Chief
04-30-2008, 06:41 PM
http://biz.yahoo.com/ap/080430/federal_borrowing.html?.v=2
Wednesday April 30, 12:36 pm ET
By Martin Crutsinger, AP Economics Writer
Administration brings back one-year Treasury bill to cope with soaring budget deficits
WASHINGTON (AP) -- The Bush administration, moving to cope with soaring budget deficits, says it is bringing back the one-year Treasury bill that it stopped issuing seven years ago when the budget was in surplus.
The administration said Wednesday it would begin selling the one-year bill, also referred to as a 52-week bill, at an initial auction in June. New one-year securities will be auctioned every four weeks.
The government is looking for various ways to borrow the billions of dollars in extra cash it will need to cover a budget deficit that is expected to jump to an all-time high this year, surpassing the old mark of $413 billion set in 2004. Private economists are projecting that the deficit for this year could surge as high as $500 billion.
A big part of the increased borrowing reflects the need to pay for economic-stimulus rebates to 130 million households. The government began disbursing the payments on Monday in an effort to give the economy a jump start.
The government stopped issuing the one-year securities in February 2001, a year when the government recorded a surplus of $127 billion. That was the fourth consecutive surplus but was also the last time the government's books were in the black. The budget was pushed back into the red by a recession, increased spending to fight wars in Afghanistan and Iraq and, Democrats contend, by President Bush's first-term tax cuts.
The return of the one-year security was announced as officials reported the government's borrowing needs for the current quarter, which will include separate auctions next week to raise $15 billion with the sale of 10-year Treasury notes on May 7 and $6 billion in the sale of 30-year Treasury bonds on May 8.
**SCHNIPP**
yah....gotta get the money to cover those checks to Ward and June from somewhere, and it makes good sense in these economic conditions to reintroduce the on-year Treasuries. Those are very secure and a lot of people will be jumping into those pretty quickly, depending on the rates...
Wednesday April 30, 12:36 pm ET
By Martin Crutsinger, AP Economics Writer
Administration brings back one-year Treasury bill to cope with soaring budget deficits
WASHINGTON (AP) -- The Bush administration, moving to cope with soaring budget deficits, says it is bringing back the one-year Treasury bill that it stopped issuing seven years ago when the budget was in surplus.
The administration said Wednesday it would begin selling the one-year bill, also referred to as a 52-week bill, at an initial auction in June. New one-year securities will be auctioned every four weeks.
The government is looking for various ways to borrow the billions of dollars in extra cash it will need to cover a budget deficit that is expected to jump to an all-time high this year, surpassing the old mark of $413 billion set in 2004. Private economists are projecting that the deficit for this year could surge as high as $500 billion.
A big part of the increased borrowing reflects the need to pay for economic-stimulus rebates to 130 million households. The government began disbursing the payments on Monday in an effort to give the economy a jump start.
The government stopped issuing the one-year securities in February 2001, a year when the government recorded a surplus of $127 billion. That was the fourth consecutive surplus but was also the last time the government's books were in the black. The budget was pushed back into the red by a recession, increased spending to fight wars in Afghanistan and Iraq and, Democrats contend, by President Bush's first-term tax cuts.
The return of the one-year security was announced as officials reported the government's borrowing needs for the current quarter, which will include separate auctions next week to raise $15 billion with the sale of 10-year Treasury notes on May 7 and $6 billion in the sale of 30-year Treasury bonds on May 8.
**SCHNIPP**
yah....gotta get the money to cover those checks to Ward and June from somewhere, and it makes good sense in these economic conditions to reintroduce the on-year Treasuries. Those are very secure and a lot of people will be jumping into those pretty quickly, depending on the rates...