The U.S. Budget Deficit tops $1 trillion for first time ever

For the first time, the U.S. government's budget deficit has topped $1 trillion. According to the Department of Treasury, June's deficit was $94.3 billion, raising the total to almost $1.1 trillion.

The deficit is raising fears of higher interest rates and inflation, in the midst of the pressure that the dollar is already under. Experts fear that a reverse in government spending, during an economic crisis, will make the situation worse. Since the fiscal year began last October, the deficit has exploded due to the economic crisis. The costs of both the financial bailout and the stimulus plan, costing $700 billion and $787 billion respectively, along with a decline of tax revenues have created the growing deficit. The cost of the wars in Iraq and Afghanistan are also an added strain. There is also chatter recently among Democrats of passing a second stimulus bill, which will add even more costs. "These are mind boggling numbers," said Sung Won Sohn, an economist at the Smith School of Business at California State University. "Our foreign investors from China and elsewhere are starting to have concerns about not only the value of the dollar but how safe their investments will be in the long run.