Analysis: Fiscal cliff could hit economy harder than many expect

[Gerald]

(Reuters) - The United States runs the risk of a recession far deeper than many investors and policymakers may think if lawmakers fail to avert looming tax hikes and cuts to public spending.

Absent action by Congress, the country will face the so-called fiscal cliff at the start of next year, a combination of lower spending and higher taxes that is expected to extract about $600 billion from the economy.

Many economists think every dollar of deficit reduction will subtract nearly the same amount from economic growth.

By that measure, the current course could cause the economy to contract by 0.5 percent in 2013, according to estimates by the Congressional Budget Office (CBO) that have been largely embraced by Wall Street and the U.S. Federal Reserve.

But research by economists in academia and at the International Monetary Fund suggests a dollar of deficit reduction could drain as much as $1.70 from the economy, making the prospective belt tightening much more dangerous.

http://www.reuters.com/article/2012/...89R0EL20121028


Note: Sun Oct 28, 2012 1:50pm EDT

[yubba]

I guess I'm going to cash in a 401k and a cd to gold and silver, bullets and beans are still a good bet to barter with cigarettes and whiskey are even better. You forgot to tell them about all the epa rules that are about to get in at the first of the year, you folks up in the northeast getting ready to get hit by franken storm that will loose power it might be some time till you get it back,, why should a private company put that much money into repair when they are fixing to be shut down by the Obama EPA.

[Takeda Shingen]

Precious metals will be worthless. Stockpiling gold and silver is a waste of time. Glenn Beck neglects to mention that, though.

EDIT:

Originally Posted by yubba

You forgot to tell them about all the epa rules that are about to get in at the first of the year, you folks up in the northeast getting ready to get by franken storm that will loose power it might be some time till you get it back,, why should a private company put that much money into repair when they are fixing to be shut down by the Obama EPA.

Actually, JCP&L alone has in the neighborhood of 1600 personnel ready to go.

http://www.heraldonline.com/2012/10/...-deployed.html

PECO has 300 line crews and 150 tree crews ready as well.

http://cumberlink.com/news/local/hur...a4bcf887a.html

Doesn't look like anyone is holding back, much to your chagrin, and your thesis.

[Gerald]

^Good links,

[Skybird]

Originally Posted by Vendor

http://www.reuters.com/article/2012/...89R0EL20121028


Note: Sun Oct 28, 2012 1:50pm EDT

First they told people that economy will suzffer if not higher debts are accepted and more money gets spent than gets earned. Now that debts have hit an all-time high they tell people it is a threat to the economy to pay back these debts.



Could it be that the economic-financial system by its very design is totally dysfunctional over any longer period time, and necessarily always will lead to collapse - because it never was meant to function honest and serious, but to use the god-mode cheat and the infinite-money cheat to bypass the game's rules from all beginning on?

Economics should not be taught at university, because they are in no way a science. They are at best a set of guesses and beliefs, and as such they have more in common with astrology than science. Economics is about math from second class elementary school: if the apple costs 1Taler, and you have 3 Taler, you can buy 3, 2, 1 or none apple - not 4 and not 5 apples. But economists get extremely clever and witty in finding excuses for why to do right that nevertheless: buyng 4 or 5 apples although you have onbly 3 Taler. That gets done, even worse, the necessary lending of money is done for a fee (interest) that increases the amount of monetarian value compared to the real value present. And that basic evil is what starts the spiral slowly turning, and that always and necessarily end with collapse. Money no ,longer is a tool for trading, but it becomes the object of trade. And some time later, debts become an object of trade that is as valuable or even more valuable than real value-goods.

Anyhow, since years I say that the US have no intention to ever pay back their debts. It will not happen, because it is not wanted, and the mess is already piling up to high. But clever ideas like described in that article, give profiteers the needed foul excuses to demand to not switch off the money printers and make things even worse by that.

Who said that money you lend needs to be given back?

And who said that you have to pay for the fourth, fifth and tenth apple?

[Gerald]

^Media has always tended to push up things for various reasons, and this may be one of those to get the doubters and the market to react differently, and it benefits some, like others who suffer.

[yubba]

Originally Posted by Takeda Shingen

Precious metals will be worthless. Stockpiling gold and silver is a waste of time. Glenn Beck neglects to mention that, though.

EDIT:



Actually, JCP&L alone has in the neighborhood of 1600 personnel ready to go.

http://www.heraldonline.com/2012/10/...-deployed.html

PECO has 300 line crews and 150 tree crews ready as well.

http://cumberlink.com/news/local/hur...a4bcf887a.html

Doesn't look like anyone is holding back, much to your chagrin, and your thesis.

well the storm hasn't yet and no one of any importance has read this thread yet. I say if the government wants to run the power companies out of business then let the government fix their own lines.

[Gerald]

and no one of any importance has read this thread yet.

Can you please specify?

[yubba]

Originally Posted by Vendor

Can you please specify?

I can't they haven't read it yet. I got a combined thread that is shy of 10,000 views, who knows. So how do get out of debt by spending more ???? 4 more years of Obama will give us a 21 trillion dollar debt. Could you please specify why,, that would be good.

[Takeda Shingen]

Originally Posted by Vendor

Can you please specify?

It was a dig at me. Yubba thinks he's funny.

[yubba]

Originally Posted by Takeda Shingen

It was a dig at me. Yubba thinks he's funny.

) Oh con twair there is a difference of thinking and knowing I crack myself up daily I'm a funny guy ask the thousands that know me, now I went and done it, I tooted my own horn, I must admit, it was the democratic party and the 47 percent that has made this all possible now I must take a bow and say thank you. Just had a thought this storm is really going to screw up the 47 percent,,holy gebis ..need to keep my mouth shut almost let the cat out of the bag..

[Takeda Shingen]

The fact that you, yubba, are actively rooting for this storm to bring as much misery and death as possible to people in the mid-Atlantic because you think it will yield political advantage to your supported presidential candidate is, to put it mildly, reprehensible.

Congratulations. You've just taken the title of the worst human being that I have ever met during my 13 years on SubSim. I've met some real pieces of work in that regard, but in the last 24 hours you've just pole vaulted right over them all.

[Gerald]

^I understand the "funny man"!

[Skybird]

Originally Posted by yubba

So how do get out of debt by spending more ????

That'S the point, exactly, and it is so simple a point. Really, it'S math, elementary school.

As I said, today's economics are no science, just the attempt to make things complicated and deceive others over them.

Everybody running a household and not having a dozen of different credit cards to shuffle his debts from here to there and then in reverse and starting all over, knows that when at the end of the month you run low on money, you must save money and buy less, or cheaper, and next month start saving money earlier so that the situation becomes not as bad at the end of the month as it was in the month before.

But when you try to explain that - what is there to explain at all? - to a politician, you get overwhelmed by an ocean of "buts" and "ifs" and "in cases". In the end, politicians are part of the problem, they want to get their careers and know people do not vote if you promise them blood and tears and cuts, so politicians will to add to the increase of debts and spend money as bribery gifts for those they hope will elect them for it.

And the bribery works. Wonderfully. The bribery - and the promises, those precious promises. Oh that sweetness, that temptation!

And that is why the ordinary people and voters are as guilty as those they accuse afterwards of having led them into a mess. Not only can you vote - you are to be held responsible for your vote.

[mookiemookie]

Originally Posted by yubba

) Just had a thought this storm is really going to screw up the 47 percent,,holy gebis ..need to keep my mouth shut almost let the cat out of the bag..

You've got to be joking. What a vile statement to make.