Why cheap-labor conservatives love the deficit
Once again, just follow the money

Here's an eye-opener for you. Never mind the health of the economy and all that, Bush loves expanding the federal deficit BECAUSE IT’S GOING TO MAKE HIM MONEY!

U.S. Treasury Notes are used to pay for the deficit.

Check out pages 3-7 of Bush’s financial disclosures from 2001. Do the math on his holdings of US Treasury Notes.

The higher the deficit, the more Treasury notes and bonds the government must sell to finance its operation. From there it's simple supply and demand -- if demand is constant but the supply of bonds goes up, the price goes down. The same is true if the deficit falls or is eliminated altogether -- the government needs to sell fewer Treasury bonds, so the supply drops and the price of T-bonds rises.

In addition to following the trend in the budget deficit or surplus, investors can gain valuable insight to the state of the economy by looking at the government's tax receipts. Higher tax receipts have been a key reason for the improved deficit situation in recent years, and they reflect the strong economic conditions.

What a strategy – invest in T-Notes, then cut taxes and crank up the deficit to record levels to make your investment worth more. Hey, while you’re at it, why not send some money to your buddies in defense and energy.