Wednesday, April 24, 2013


 A budget deficit that was more than 10 percent of GDP in 2009 is on track to be about half that this year. “The federal budget deficit is shrinking rapidly,” writes Jan Hatzius, the chief economist of Goldman Sachs, in an April 10 report. Goldman estimates that in the first three months of 2013 the deficit was running at 4.5 percent of GDP, and they forecast a deficit of 3 percent of GDP or less in the 2015 fiscal year. Hatzius adds that “there is still a great deal of room for the economic recovery to reduce the deficit for cyclical reasons.”Source: Goldman SachsSource: Goldman Sachs
In other words, if policymakers can just not blow it and keep the recovery on track, that alone will do a good bit of the heavy lifting of deficit reduction.
Maybe not. Because, of course, nobody cares about the deficit (© atrios).

Via @deficitowl: "Run deficits, stupid."