The real budget deficit: $4.6 trillion
Updated with 2006 figures: Economist John Williams is out with his 2006 estimate of the true federal budget deficit. While the media reports the figure of $247.7 billion (a phony-baloney figure that if used by any accountant in private business would result in fines and prison time) and you get a figure of $449.5 billion if you use generally accepted accounting principles (GAAP), Williams throws in the ongoing liabilites from Social Security, Medicare, etc.
The real budget deficit by this measure is $4.6 trillion.
Williams warns at his ShadowStats website:
…the unfolding fiscal nightmare likely will entail a U.S. hyperinflation and a resulting collapse in the value of the world's primary reserve currency, the dollar. When this starts to unravel it will unravel fast. I don't know whether it will be the dominant issue in the 2008 presidential election, but I believe it will be by 2012.
How did we get to this state of affairs? Addison Wiggin lays it all out in his book The Demise of the Dollar…and Why It's Great For Your Investments. And as the title implies, a falling dollar doesn't have to send you into penury. Learn how, and get a super holiday discount at this link.