I have been spending a good amount on one Campaign and I checked Recommended Budget and it recommended 3 times what I was spending. I upped my budget by 50% but it is still spending at the original amount. I've upped it again just to see if it would trigger more traffic (if there really was more traffic at my bid amounts). Do you find that Google's recommended budget tool will provide a budget that has available traffic? If you raise the budget can they actually provide the traffic?
I dont get it too. But a "budget" is worthless anyway, if you don't want to use Adwords purely for brand building. If you want to sell something with adwords, you should never reach your daily budget. If you know how much you earn per Dollar spent, you don't need a maximum budget. If you can earn $2000 a day, if you spend $1000, why limit your daily spendings to something lower?
I do get a good return so my budget could be unlimited. In this case they have been telling me to triple my budget but when I upped it 50%, they didn't provide traffic enough to spend it. My other campaigns are telling me my budget is OK. Hopefully they will provide more traffic now that I have increase my budget even further.
The daily budget is based on around 2% CTR. You will not reach the daily budget if your CTR is much lower. (And you will overshoot if your CTR is very high.) The daily budget is your estimated potential. Improve your ad text and/or increase your max CPC to increase the number of clicks.