The U.S. Treasury faces historic financing demands from a weakening economy and the added costs of a $700 billion Wall Street rescue program, the department’s top domestic finance official said today.
“This year’s financing needs will be unprecedented,” said Anthony Ryan, the Treasury’s acting undersecretary for domestic finance, at a Securities Industry and Financial Markets Association conference in New York, where he was a last-minute substitute for Treasury Secretary Henry Paulson.
Ryan’s borrowing outlook comes after Treasury officials spent much of the past month publicly praising the rescue plan’s virtues. The Treasury needs to sell debt to raise money for the new initiatives and also cope with a weaker economy, two factors analysts say may push the country’s budget deficit to more than $1 trillion for the current fiscal year.
Considering the original forecast was for 400+ billion dollar deficit, that is quite a jump.