The main practical implications of the federal budget deal were discussed in a report last weekend.  The budget deal delivers an ill-timed impetus to aggregate demand growth, which will have to be offset by the Fed.  For investors, that is what matters.

Nevertheless I follow up here with an assessment of the longer-term outlook for the federal debt and speculate on some implications of that.  It would seem to be a very serious issue, but for regular people and not likely the capital markets, particularly over a horizon that would interest investors now.

That nagging feeling you have that something is not quite right with the soaring debt maybe should bug you more as a citizen than speculator.  FH-180218