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U.S. Treasury To Borrow $3 Trillion In 3 Months To Pay For Pandemic

U.S. Treasury To Borrow $3 Trillion In 3 Months To Pay For Pandemic thumbnail

The U.S. Treasury Department plans to borrow nearly $3 trillion between April and June to bankroll the federal response to the coronavirus pandemic.

It’s an unprecedented level of deficit financing to match the historic economic hit caused by the virus. In a single quarter, the government will borrow more than twice as much as it did all of last year.

“The increase in privately-held net marketable borrowing is primarily driven by the impact of the COVID-19 outbreak,” the Treasury Department said in a statement.”

The government had expected an influx of cash during the April to June quarter, as businesses and families paid their income taxes. But the tax filing deadline was pushed back until July.

Meanwhile, with the economy cratering and unemployment climbing to levels not seen since the Great Depression, Congress has authorized trillions of dollars in relief payments, unemployment benefits and loans to small businesses, as well as money for vaccine research and coronavirus testing.

The Treasury Department said it expects to borrow another $677 billion between July and September.

Despite the surge in federal debt, the government’s borrowing costs remain low. The Federal Reserve has promised to buy as much Treasury debt as necessary to weather the pandemic.

“This is the time to use the great fiscal power of the United States to do what we can to support the economy and try to get through this with as little damage to the longer run productive capacity of the economy as possible,” Fed chairman Jerome Powell said last week.

Powell described himself as someone who has long argued against runaway federal deficits.

“But this is not the time,” he said, “to let that get in the way of us winning this battle.”


6 Comments on "U.S. Treasury To Borrow $3 Trillion In 3 Months To Pay For Pandemic"

  1. makati1 on Mon, 4th May 2020 6:57 pm 

    PRINT, BABY, PRINT! The dollar is on its way to even cheaper toilet paper, but then, the US is being flushed down the shitter and it will not be needed soon, anywhere.

    I hold zero USDs as I exchange my income USDs to Philippine Pesos ASAP and build my preps for the coming collapse, and maybe, war.

    BYW: NPR = National Propaganda Radio.

  2. Abraham van Helsing on Mon, 4th May 2020 7:29 pm 

    “ U.S. Treasury To Borrow $3 Trillion In 3 Months To Pay For Pandemic”

    Big deal, 6 weeks US GDP.

    You never went to your mom and borrowed a month’s worth of income?

    Munchin doesn’t even need to pay it back, just another round of inflation. Yawn. What’s wrong with a couple % inflation per year anyway? The dollar lost perhaps 100 times the value it had 100 years ago, if you can even measure those things. Two zeroes extra don’t mean a thing.

  3. Brent Georgeson on Tue, 5th May 2020 5:13 pm 

    Currently I am a university student and I have asked many economists what will happen if we just keep printing money? This is the billion dollar question since we have never been here before to this capacity. All of the economists have told me in econo talk that they don’t know what will happen. We are in uncharted territory and we do because it works. My two cents is that when investors realize that they will not get paid back that the debt will have to be written off the dollar will be worthless.

  4. printbabyprint on Wed, 6th May 2020 12:21 am 

    Excellent response Brent

  5. Just An Average Joe on Thu, 7th May 2020 9:21 am 

    Because of the coronavirus, the world will never be the same again. Face masks, elbow bumping, social distancing will be the new normal.

  6. Chrome Mags on Thu, 7th May 2020 11:44 am 

    Certain people whined about increase US debt when Obama was prez, even though there was a need to pull the economy out of the crapper from the mortgage meltdown during Bush Jr’s failure, but what about the trillions in debt Trump is ringing up and it’s not just due to the pandemic. It’s from the giveaway to his crony friends at the expense of every day hardworking folks.

    Trillions upon trillions to the tune of looks like it will end up being in the neighborhood of 8 trillion dollars in debt added in 4 years?! That’s 2 trillion a year.

    What happened to the ‘Tea Party’? I guess they fell adoringly in love with Trump and then what the heck, let the cronies have a huge tax cut, jacking deficits into the sky.

    And to make matters worse, it looks like the US helped fund research at the Wuhan lab that led to an amazingly contagious and virulent virus geo-engineered from a bat virus. That’s great, that’s just great! Anything else?

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