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What’s a budget balance?
Budget balance is the difference between what a country’s government earns from taxes and other sources, and what it spends. A budget deficit occurs when spending exceeds earnings.
When spending exceeds earnings, the government borrows money from its citizens. It also borrows money from foreign entities. If this debt accumulates, the value of its currency could decrease. The currency decreases because of fears within the international community. Other countries question the country’s ability to repay its debt.
Tracking the federal budget balance
The U.S. Treasury reports the federal budget balance monthly. The US government posted a budget surplus of $2 billion in December, booking a smaller windfall than the same month last year, as Fannie Mae and Freddie Mac payments dropped.
Including the December surplus, the US budget deficit is $177 billion for the first three months of fiscal 2015. That’s 2% more than for the first quarter of fiscal 2014.
The government spent $333 billion in December, up 44% from December 2013. Total receipts in December were $335 billion, an increase of 18%. Both individual and corporate tax receipts rose in the month.
The budget deficit’s impact on US debt
Deficits continue to accumulate. They keep adding to the US federal debt. The federal debt has exploded since 2008, but the situation is getting better. This should be positive for the US dollar. A strengthening US dollar usually leads to weaker gold prices.
This is negative for gold-backed ETFs such as the SPDR Gold Trust (GLD). The deficit is also negative for stocks such as Goldcorp (GG), Randgold Resources (GOLD), AngloGold Ashanti (AU), and Kinross Gold (KGC). It also hurts ETFs that invest in these stocks, such as the Market Vectors Gold Miners ETF (GDX).
The companies mentioned above form 24.3% of GDX’s holdings.
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Randgold Resources Ltd.
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PRODUCTEUR |
CODE : GOLD |
ISIN : US7523443098 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Randgold Res. est une société de production minière d'or basée au Royaume-Uni. Randgold Res. détient divers projets d'exploration en Tanzanie. Ses principaux projets en production sont MORILA, LOULO et TONGON au Mali et OBUASI au Ghana, ses principaux projets en développement sont KIBALI (KILO-MOTO) en Republique Democratique Du Congo, MASSAWA au Senegal et GOUNKOTO au Ghana et son principal projet en exploration est MIYABI en Tanzanie. Randgold Res. est cotée au Royaume-Uni, aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 1,6 milliards US$ (1,5 milliards €). La valeur de son action a atteint son plus bas niveau récent le 07 novembre 2003 à 10,03 US$, et son plus haut niveau récent le 04 janvier 2013 à 99,88 US$. Randgold Res. possède 93 804 000 actions en circulation. |