As we forecast back in November,
it is now official that the House will not vote on any deal out
of the Senate, assuming there is one, later today, which means America
will officially slide off the Fiscal Cliff. And now cue
everyone being very hopeful and optimistic a deal will get done momentarily, if
not sooner, in 2013. Of course, we all know just how far optimism takes
America's dysfunctional Congress. The biggest irony in all of this is that
the only winners today were the much hated "1%"-ers, whose
taxes may or may not go up, who just got to book major year end profits on this
last minute ramp. The remainder of America's population can quietly look forward
to 2013 with "hope" and "optimism" that in 2013 Congress will finally stop being
dysfunctional. Good luck. Oh, and before we forget, America just
breached its debt ceiling: now the pillaging of various government
retirement funds begins.
Finally, since the US is now officially over the cliff, does this mean that Ben Bernanke can finally get to work? Recall his words:
Finally, since the US is now officially over the cliff, does this mean that Ben Bernanke can finally get to work? Recall his words:
"if the economy actually went off the fiscal cliff, our assessment, the CBO’s assessment, outside forecasters, all think that that would have very significant adverse effects on the economy and on the unemployment rate. And so, on the margin, we would try to do what we could. We would perhaps increase a bit."Is it time to increase QE just "a bit" then?
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