Post by jeffolie on May 10, 2012 19:39:46 GMT -6
Republicans avoid fiscal cliff backlash now causing Eurozone regime
Bonds ignore 7mo. fiscal cliff...no risk bonds premium...10 year below 2%..."Politics Matters"procrastination deferred the balance budget actions until Jan 2013 when the newly elected Republican dominated government will deal with it in 7 months from now...unpopular scheduled "austerity" avoided during the election year to the advantage of Republicans who can duck the current 'Politics of the Backlash' tarnish and label now making Eurozone 'regime change'.
" ... Fiscal cliff poses a Greek moment for the U.S. ... of tax increases (through the expiration of the Bush tax cuts) and across-the-board spending cuts from last year’s debt-ceiling compromise that will automatically go into effect next year absent any new legislation....
"... A Congress engaged in trench warfare prior to November’s election is not likely to reach a compromise, so the thinking is that they will deal with it in the lame-duck session following the election or at the latest, with a retroactive measure in the new Congress early in the new year...."
my jeffolie view: Republicans now campaign for strict, punishing budgets everywhere without suffering the unpopular scheduled "austerity" avoided during the election year to the advantage of Republicans who can duck the current 'Politics of the Backlash' tarnish and label now making Eurozone 'regime change'.
=============================
May 10, 2012
Fiscal cliff poses a Greek moment for the U.S.
WASHINGTON (MarketWatch) — The U.S. is not like Greece in most respects but we may be facing a Greek moment with the “fiscal cliff” looming at the end of the year.
A Greek moment politically, not economically.
Greek voters are being roundly criticized from all sides for producing a hung Parliament in last Sunday’s election, but they face a genuine quandary.
They want to stay in the euro, but not at any price. Right now, the price seems too high. And all the talk of how leaving the euro would be worse than the austerity measures required for the bailout leaves the Greeks cold because they don’t really believe Europe would pull the plug on them.
Greece on brink of social and political breakdownThe Greek rescue plan is on the brink of collapse. The participants in the weekend's election have failed to form a new government and the rescue package threatens to unravel the common currency.
For this reason, Alexis Tsipras, leader of the Coalition of the Radical Left, which emerged as the second-strongest party from the election, feels he can call Europe’s bluff and demand that the bailout terms be renegotiated.
Now it looks like Greeks will have to vote again and decide whether they agree with Tsipras, or dial back a bit and give a little more support to the two mainstream parties, New Democracy and Pasok, who at least give lip service to honoring the terms.
It’s a high-stakes brinksmanship for Greece and for Europe.
The situation in the U.S. is different in terms of economic consequences, but poses a similar political quandary.
House votes to avert defense cuts
Automatic cuts to the military budget worth some $55 billion would be blocked under a bill approved by the House, but faces certain defeat in Senate.
Everyone from Federal Reserve Chairman Ben Bernanke on down has warned about the threat to the economic recovery from the looming fiscal cliff — the combination of tax increases (through the expiration of the Bush tax cuts) and across-the-board spending cuts from last year’s debt-ceiling compromise that will automatically go into effect next year absent any new legislation.
A Congress engaged in trench warfare prior to November’s election is not likely to reach a compromise, so the thinking is that they will deal with it in the lame-duck session following the election or at the latest, with a retroactive measure in the new Congress early in the new year.
What’s Greek about this moment is that in the meantime we are twisting in the wind. The very uncertainty about what’s going to happen may already be damaging the recovery.
This was the message from JP Morgan Chase CEO Jamie Dimon this week at an event in Ohio, where he urged Congress and the White House to address the cliff issue before the election.
“It may affect the continued growth of the country before we get to the election,” the banker said an event at Ohio State University.
He dismissed the idea that action could wait until after the election. “It would be too late,” Dimon said during an interview conducted by NBC’s David Gregory. Read the account of the interview in the Columbus Dispatch.
Just as the Greek quandary has thrown Europe into turmoil and exacerbated its slide back into recession, so the intransigence in Congress over the questions of taxes and spending threatens to create a damaging economic uncertainty here.
Reuters
U.S. House Speaker John Boehner (returns leaves the House Chamber after passage of the debt-ceiling agreement last August.
This is the line House Speaker John Boehner took in an interview with CNBC-TV this week, warning that the prospect of tax increases is slowing down the recovery.
He promised action in the House both to extend “all” the current tax rates and to replace the so-called “sequester” — those across-the-board spending cuts — with specific cuts. “We need to reduce the uncertainty,” he told CNBC’s Maria Bartiromo. Read the transcript of the interview.
Of course it is the “all” in those plans that is the sticking point, since Democrats want to let the cuts for higher income brackets expire and narrow the deficit in that manner.
Boehner acknowledged this in the interview, calling on the Democratic-controlled Senate to act. “Until the Senate acts, it’s hard to determine how we deal with this,” he said.
Does that mean House Republicans are ready to compromise with a bill emerging from the Senate? Question not asked and not answered.
Because we know the answer, and therein lies our Greek moment, our very own hung parliament.
www.marketwatch.com/story/fiscal-cliff-poses-a-greek-moment-for-the-us-2012-05-10?link=home_carousel
Bonds ignore 7mo. fiscal cliff...no risk bonds premium...10 year below 2%..."Politics Matters"procrastination deferred the balance budget actions until Jan 2013 when the newly elected Republican dominated government will deal with it in 7 months from now...unpopular scheduled "austerity" avoided during the election year to the advantage of Republicans who can duck the current 'Politics of the Backlash' tarnish and label now making Eurozone 'regime change'.
" ... Fiscal cliff poses a Greek moment for the U.S. ... of tax increases (through the expiration of the Bush tax cuts) and across-the-board spending cuts from last year’s debt-ceiling compromise that will automatically go into effect next year absent any new legislation....
"... A Congress engaged in trench warfare prior to November’s election is not likely to reach a compromise, so the thinking is that they will deal with it in the lame-duck session following the election or at the latest, with a retroactive measure in the new Congress early in the new year...."
my jeffolie view: Republicans now campaign for strict, punishing budgets everywhere without suffering the unpopular scheduled "austerity" avoided during the election year to the advantage of Republicans who can duck the current 'Politics of the Backlash' tarnish and label now making Eurozone 'regime change'.
=============================
May 10, 2012
Fiscal cliff poses a Greek moment for the U.S.
WASHINGTON (MarketWatch) — The U.S. is not like Greece in most respects but we may be facing a Greek moment with the “fiscal cliff” looming at the end of the year.
A Greek moment politically, not economically.
Greek voters are being roundly criticized from all sides for producing a hung Parliament in last Sunday’s election, but they face a genuine quandary.
They want to stay in the euro, but not at any price. Right now, the price seems too high. And all the talk of how leaving the euro would be worse than the austerity measures required for the bailout leaves the Greeks cold because they don’t really believe Europe would pull the plug on them.
Greece on brink of social and political breakdownThe Greek rescue plan is on the brink of collapse. The participants in the weekend's election have failed to form a new government and the rescue package threatens to unravel the common currency.
For this reason, Alexis Tsipras, leader of the Coalition of the Radical Left, which emerged as the second-strongest party from the election, feels he can call Europe’s bluff and demand that the bailout terms be renegotiated.
Now it looks like Greeks will have to vote again and decide whether they agree with Tsipras, or dial back a bit and give a little more support to the two mainstream parties, New Democracy and Pasok, who at least give lip service to honoring the terms.
It’s a high-stakes brinksmanship for Greece and for Europe.
The situation in the U.S. is different in terms of economic consequences, but poses a similar political quandary.
House votes to avert defense cuts
Automatic cuts to the military budget worth some $55 billion would be blocked under a bill approved by the House, but faces certain defeat in Senate.
Everyone from Federal Reserve Chairman Ben Bernanke on down has warned about the threat to the economic recovery from the looming fiscal cliff — the combination of tax increases (through the expiration of the Bush tax cuts) and across-the-board spending cuts from last year’s debt-ceiling compromise that will automatically go into effect next year absent any new legislation.
A Congress engaged in trench warfare prior to November’s election is not likely to reach a compromise, so the thinking is that they will deal with it in the lame-duck session following the election or at the latest, with a retroactive measure in the new Congress early in the new year.
What’s Greek about this moment is that in the meantime we are twisting in the wind. The very uncertainty about what’s going to happen may already be damaging the recovery.
This was the message from JP Morgan Chase CEO Jamie Dimon this week at an event in Ohio, where he urged Congress and the White House to address the cliff issue before the election.
“It may affect the continued growth of the country before we get to the election,” the banker said an event at Ohio State University.
He dismissed the idea that action could wait until after the election. “It would be too late,” Dimon said during an interview conducted by NBC’s David Gregory. Read the account of the interview in the Columbus Dispatch.
Just as the Greek quandary has thrown Europe into turmoil and exacerbated its slide back into recession, so the intransigence in Congress over the questions of taxes and spending threatens to create a damaging economic uncertainty here.
Reuters
U.S. House Speaker John Boehner (returns leaves the House Chamber after passage of the debt-ceiling agreement last August.
This is the line House Speaker John Boehner took in an interview with CNBC-TV this week, warning that the prospect of tax increases is slowing down the recovery.
He promised action in the House both to extend “all” the current tax rates and to replace the so-called “sequester” — those across-the-board spending cuts — with specific cuts. “We need to reduce the uncertainty,” he told CNBC’s Maria Bartiromo. Read the transcript of the interview.
Of course it is the “all” in those plans that is the sticking point, since Democrats want to let the cuts for higher income brackets expire and narrow the deficit in that manner.
Boehner acknowledged this in the interview, calling on the Democratic-controlled Senate to act. “Until the Senate acts, it’s hard to determine how we deal with this,” he said.
Does that mean House Republicans are ready to compromise with a bill emerging from the Senate? Question not asked and not answered.
Because we know the answer, and therein lies our Greek moment, our very own hung parliament.
www.marketwatch.com/story/fiscal-cliff-poses-a-greek-moment-for-the-us-2012-05-10?link=home_carousel