From what I have gathered there is an agreement on not raising the tax/cut off the Bush era cuts on the middle class. Taxes to go up on those making $400K. Child tax credit are still in effect. Another extension for unemployment benefits. Market responding.

"
Obama said there were “still issues to resolve” in the talks. He said he was “hopeful that Congress can get it done. But it’s not done.”

I thought Bronco Obama did a good job of explaining why the GOP should see doing things his way ... seriously he has backed them into a corner.

DOW has gone up to a new high for today, so I guess that the bullet has been dodged for now...of course, the Schwerer Gustav size bullet is still in flight, but you take what you can get. :haha:

No deal has been struck, the House won't vote on it!!

http://www.msnbc.msn.com/id/50333173

It'll go retroactively, like mookie said. Probably get passed Thursday or Friday.

Give this man a cigar.

What Congress has made (the self-imposed December 31st deadline) they can un-make. All they have to do is get it done within the next week or so, and say that it's retroactive.

Anyone that didn't think it would come down to this is fooling themselves. If one side had agreed to something before now, their supporters would have been furious and asked "what else would we have gotten if we had pushed the other side to the deadline?"

We do have term limits on congress. The citizens choose not to use them.

Hah! Like I always tell people who bang the term limits drum: "We have term limits. They're called 'elections.'"

It's never one's OWN member of Congress who's the problem. It's always everyone else's. And that's why we are stuck with the situation we're stuck with.

Well that's not quite true. The way I see it all of my states members of Congress are major parts of the problem.

So is it now a case of uncircling the wagons and doing the inevitable deal retroactively in a week or so?

If that is the case it'll be interesting to see what effect it has on the European stock exchanges and in my personal interests....the FTSE

So America fell off the cliff on to a trampoline. :-?

Jim forget it, stock markets are now controlled by speculative trading without a care in the world for the rest of us.

Very true but it still effects the smaller investors even if it is those who club together with the investment houses.

That is only because they are all Team D and you are a cheerleader against that flavour team

Also, it's lucky that today is a national holiday so all the markets will be closed, tomorrow will be when it starts to be felt, but Steed has a point that since it's done on mostly speculative data, then since the Senate has passed this deal, and it's trickling down to the House, then by Wednesday it should be about ready to roll and the markets will come out strong.

Providing of course that the House doesn't reject it. It's got until Wednesday, and then it'll be replaced by the House elected in November, which has a slimmer majority than the current one, so they might want to stall until then for political football, I don't know. We shall see.

This is nothing new.

Just recognize what term limitations are

It is the government telling the citizens that the citizens no longer have the right to choose their state/district representative; but that the government will decide who the citizens can vote for.

Is this really what we want? Do we really want to give the government that much power over the basic element of democracy - elections.

Simply because we have term limitations on the POTUS (and idea that is worthy of debate), does not mean we should apply it to our individual representatives in congress.

Term limitations initially sounds like a good solution. But it may be a cure worse than the disease.

I prefer the citizens to maintain the right to elect who they wish to be their state/district representative in the most powerful government body we have. Even if the citizens choose to use this right unwisely.

In America, anyone can grow up to be a member of congress. That is just one of the risks we have in a representative government. :yep:

The solution is have a more educated citizenry. A citizenry who looks beyond R and D and looks at the actual individual. A citizenry who chooses as their representative, the right person and not necessarily the party person.

That is the only glimmer of hope I can see from this current congress. Perhaps this dismal congress will finally get some of the citizens to look beyond R and D and look at the actual person and what that person does/does not do.

Change will come slow. Most people will still vote party. But slowly, perhaps, we can get more people to look beyond the party.

A boy can dream.

The situation is a catch-22. No matter what the US chooses to do, it will be the wrong thing. Either there is a compromise on the budget - than more debts will be made unavoidably. Or a budget policy comes from this conflict to damage Obama, that results indeed in lesser debts being added, but then the US and the rest of the world will pay an economic price in the short term, and medium term as well.

This is because the situation has been allowed since long time to hopelessly detoriate. And now it is FUBAR.

The following is my slightly cut translation of a comment by Wolfram Weimer, first published in the German "Handelsblatt".

16,500,000,000,000 dollars in debts.

The financial world closely watches Washington. The fiscal cliff one way or the other will be avoided, and America will organise the next great reshifting effort of its ever growing debt burden in order to use tricks to buy time. But the debts have reached a dimension unimaginable, that endangers the whole global economy.

The key problem of America are not the rocks of modesty and self-mastering its spending frenzy, but it is the ocean of debts washing over them. America has made so many debts in so few years, like no other state or empire in the whole history of mankind. Every single day, the American state adds another whopping 3.5 billion dollars to its already existing debts. Only an unconditional optimist can hope that this can go on for much longer without the system breaking.

The raise by 6 trillion dollars in debts by Obama'S first legislation period, are a historical fanal. By that he has surmounted so many debts like all American governments from George Washington until the introduction of Bill Clinton together. The woes we have over Greece, are hilarious compared to the disaster that is being bred in the US.

But also the view on the contemporary budget discipline is reminding of a chaos that is beyond all repair. According to the FED, the yearly deficit per every year of the past four years in Obama's first legislation, had climbed to a yearly mean value of 1274 billion dollars. A thought experiment reveals what this number means: a human born in the year of Jesus' birth, who on every single day since then until our present today would have added an additonal 1 million in personal debts, would today still have smaller debts in total than the US is accumulating in just one single year.

Compared to that, the debt-drowning European continent appears to be almost solid and healthy. Because Washington in just one day adds as many new, additonal debts, than a state like Bulgaria currently has in total. In the past year alone it has made as many new debts, as all of Eastern Europe, the Baltic states, all of scandinavia, Greece, Portugal and Ireland have mounted up in decades.

An ecnomiy professor from the university of freiburg, Bernd Raffelhüschen, additionally warns of the "Nachhaltigkeitslücke" (=maintenance gap?) of the US. With a total debt level of 110% of the GNP, Washington not only has an exceptionally high explicit debt. The implicit debts hidden in the social costs (future pensioneers etc) is biblical and surpasses the national economic power, the GNP, by several factors.

The currenbt haggling while balancing on the fiscal cliff, so one could only hope, would lead America to a general reversing in its misled fincancial policies. America would need a giant solidarity program which would need a massive increase in general taxes, and a draconic cut in spendings at the same time. For the short-termed economic prospects regarding a hoped-for "boom time", this maybe would not be really helpful. But at least it would by far not be as self-destructive as the current "after-me-the-end-of-the world"-policy, that by now already is a lethal threat to the whole global economy system.

Because if already the crash of a single bank like Lehman or the bancrupcty of a small state like Greece sends threatening shockwaves through the global system, what kind of an earthquake will flatten it all if the financial markets give up on America? Already by now the US has to pay every year an interest of 500 billion for its already existing debts. The FED still pushes the faiy tale solution of just printing increasingly worthless money unlimitedly, to keep the debt machine moving on on an well-oiled, greasy trail. But when the belief in this miraculous multiplying of money from nothing will come to an end, total disaster, an economic catstrophe never seen before, threatens to crack down on the whole globe. It is high time that America starts to remember the words by George Washington, who wrote in 1799 already: one must not allow new debts for the purpose of financing already existing debts.

---

Well. It will not happen. Too much ideological blindness. Too much egoism. Too many politicians trying to abuse the present for their career and own interest, hoping to delay the disaster long enough so that it does not happen as long as they are still in office themselves. Too much lobbyism.