Trillion Dollar Deficits … Part One

The latest report from the Congressional Budget Office was released today. The outlook is grim. Here’s a link to the report: CBO Outlook 2009 – 2019

The report is the usual long winded analysis, but the headline is the Federal deficit of over $1 trillion for this revenue year. And that’s without the effects of any stimulus plan.

The forecast includes a projected decline in GDP of 2.2% for this year and only a modest recovery in 2010. This is in line with many private sector forecasts and reflects the awful conditions that still prevail in the housing and financial markets. The CBO calls the current recession both ‘long and deep’ which surely is becoming an understatement.

Also buried in the report is an estimate that house prices will fall an additional 14% between the latter part of 2008 and early 2010.

The report is published by the non-partisan CBO and is worth the time to browse. That is if you have the stomach for all that bad news!