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A ‘Hawkish Cut’ From A ‘Derelict’ Fed? What To Expect From The October FOMC
The Fed will cut rates for the third time in three meetings this week. If they don't, they'll blindside markets and incur the wrath of an increasingly irritable Donald Trump, who last week declared that policymakers would be "derelict in [their] duties" if they sit on their hands.
"We believe the mixed growth data since the last meeting more closely resembles the Committee’s baseline forecast than the downside scenarios under discussion", Goldman writes, in their Fed preview (called "three an
Related topics: “Total Public Debt Cash Redemptions Withdrawn from Federal Reserve Acct” —
Apparently, Withdrawals represent money spent by the federal government through each of various agencies and programs.
T3B | (Adjustment of Public Debt Transactions to Cash Basis): This table converts sales and repayments of debt into a cash line item showing their impact on the Treasury’s Federal Reserve Account in Table II:
Not all debt issued by the U.S. government is subject to the Congressionally-mandated “debt limit.” By law, certain types of debt are exempt from the limit, like debt held by a Treasury subsidiary, the Federal Financing Bank.
Table III C takes the total public debt outstanding — the sum of debt held by investors and internal governmental I.O.U.s — and adjusts it by subtracting exempt debt types like the Federal Financing Bank. The total public debt is calculated in the first two line items, by adding up debt held by the public and intragovernmental holdings. This total is then decreased by exempt holdings listed below, such as the Federal Financing Bank, to arrive at the total debt subject to the debt limit in the bottom of the table. The prevailing debt limit is listed below that total, showing how close the government is to breaching the limit. __ The data can be accessed in Treasury.io by querying table “T3C” — short for Table III C
DAILY TREASURY STATEMENT
Cash and debt operations of the United States Treasury
Thursday, October 24, 2019
TABLE I Operating Cash Balance
Federal Reserve Account
TABLE II Deposits and Withdrawals of Operating Cash
Federal Reserve Earnings
Total Federal Reserve Account
Transfers from Federal Reserve Account
TABLE III-B Adjustment of Public Debt Transactions to Cash Basis
Deposited in Federal Reserve Account
Withdrawn from Federal Reserve Acct.
TABLE III-C Debt Subject to Limit
Total Public Debt
Subject to Limit 22.897 Trillion (oh but wait, what about the $21.988 trillion limit? )
*Statutory debt limit temporarily suspended through July 31, 2021
https://fsapps.fiscal.treasury.gov/dts/files/19102400.txt
See: Updated August 29, 2019
The limit was reset on March 2, 2019, at $21.988 trillion to accommodate federal obligations during the suspension period. On March 4, 2019, Treasury Secretary Steven Mnuchin invoked extraordinary authorities. As noted above, the 2019 debt limit episode was resolved on August 2,
2019 with enactment of the Bipartisan Budget Act of 2019 (BBA 2019; P.L. 116-37; H.R. 3877), which suspended the debt limit until July 31, 2021.
https://fas.org/sgp/crs/misc/R43389.pdf
So, after that confusion, it’s interesting to look at lots of charts @ economagic, but I’m not sure their charts are generated by data @ FRED … so working on that. Nonetheless, looks like some strange things going on with cash. Economagic has charts that show trends in TABLE III-C Debt Subject to Limit here:
http://www.economagic.com/em-cgi/data.exe/TreasDTS/day-TIII-C06@@wklysum
What does this imply about the debt ceiling and the Fed lower rates — and how does this fit into the trump balanced budget? Duh … Do we have an accountant anywhere that can explain this to 3rd graders?