The July numbers are in. Unlike the BLS data — which can get “seasonally adjusted” into something unrecognizable months later — the Congressional Budget Office’s tallies are final. What they report es lo que es. It is what it is.
In near real-time, we can see exactly how much Uncle Sam is hauling in from taxes and tariffs… and how much is pouring back out for the military, social programs, and, of course, the ever-growing interest on the national debt.
Even as President Trump touts record tariff revenues, the red ink flows on.
Government continues to spend far in excess of what it brings in, even as tariffs rise. (Source: CBO)
July alone saw a $291 billion deficit — in one month. At this pace, annual deficits could easily run closer to $3 trillion. That money will either be printed or borrowed at rates north of 4%.
The Department of Government Efficiency (DOGE) hasn’t made much of a dent in spending, nor have sky-high tariff rates. Which leaves us with a stubborn reality: the deficit remains the single biggest long-term threat to the American success story.
~ Addison
P.S. Some companies are thriving under the shifting tariff regime — and from other Trump policies that are decidedly pro-growth. But “pro-growth” also means you need lower interest rates. At least in the Trump Great Reset playbook.
The tricky part? Government printing debt out of thin air usually means more inflation. Under normal circumstances, the Federal Reserve would be leaving rates unchanged in September… or even raising them.
Therein lies the pickle we’re in.
You can’t let interest payments on the existing debt swallow the government budget. This means that, in addition to “pro-growth” economic strategies, you need lower interest rates.
But lower interest rates also mean higher consumer prices for necessities like energy, food, housing, health care and tuition.
The bond market doesn’t like deficits or debt, either. Investors demand higher interest rates to lend the government money.
Like we said, it’s a pickle.
We’ll be digging into both sides of that equation — plus our latest research — in this week’s Grey Swan Live! on Friday, August 15, 2025… exactly 54 years since Nixon “closed the gold window.” Members will get the sneak peek before anyone else.
A special note to Grey Swan subscribers: This week’s Grey Swan Live! will be held on Friday at 11 a.m., not tomorrow. We’re in the middle of some new groundbreaking research – and will have even more details that afternoon. But our paid-up Fraternity members will get an early sneak peek at what we see developing.
Sneak Peek Grey Swan Live!
Friday, August 15, 2025
11am ET
We set up a “VIP access” hot list for non-paying members of the Grey Swan Investment Fraternity. To be reminded before Friday’s event, click on this link and add your name and e-mail to the list.
As always, your reader feedback is welcome: feedback@greyswanfraternity.
