This morning Politico’s Ben White wrote that the fiscal cliff is basically over.Closing Bell’s Maria Bartiromo couldn’t disagree with him more.
She wrote a super bearish column on the issue for CNBC, and to her, words like “panic stricken” are definitely in order.
The Mayans may not be right about the world ending by the end of 2012, but the next month and a half is looking a lot more panic-stricken than celebratory.
The ongoing fight over the “fiscal cliff” may overshadow everything else as we get closer to the new year. Sadly, compromise seems hard to come by, even though the consequences of going over the cliff — hundreds of billions of dollars of spending programs that are set to expire, along with the largest tax increase since World War II for virtually all income levels — was specifically designed to force compromise.
Bartiromo goes on to lay out the positions of Republicans and Democrats. Democrats want to raise taxes on the wealthy (which she says won’t solve our problem) and Republicans want to cut spending while closing tex loopholes.
In her view, Republicans are the lesser of the two evils as they’re at least open to raising revenue.
Either way, her outlook on this is pretty negative. This is how she closes the piece:
The question is how tough it will be to reverse the damage if Washington takes us over the brink? How long and drawn out will a recession be while our lawmakers fail us? The best we can do as investors is prepare for much higher capital gains and dividend taxes that are surely to come. How much worse it is beyond that will be dictated by how much self-inflicted damage Washington is willing to impose on America’s economy.
Let’s just say I’m not optimistic.
Pretty bleak stuff no?
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