Avoiding the Fiscal Cliff and Pleasing Financial Markets We are now firmly in the lame duck session of Congress and financial markets will continue to be wary about lack of progress in postponing the fiscal cliff. Some fiscal policy tightening will happen in 2013. At the moment, markets seem to be discounting tightening of 1% […]
Archive | November, 2012
Into the Unknown: US Monetary Policy under the Fiscal Cliff Scenario
Will the Fiscal Cliff Force Further Quantitative Easing? Now that the US Presidential election is over, financial markets are focussing on the prospect of a full-blown fiscal cliff scenario engulfing the economy. Observers agree that such an outcome would be disastrous: the economy would fall into recession, producing a renewed rise in unemployment. It would […]
The Economic and Financial Implications of the 2012 US Presidential Election
Perceptions Die Hard The uncertain outcome to the US Presidential election was cited by many commentators as to why corporate risk-taking has remained subdued in 2012. The political landscape is essentially the same as to what prevailed prior to the election. There was a widely-held presumption that a Romney victory would be bullish for equities, […]
Weaker US Potential GDP Growth and Deleveraging: Formidable Challenges Whoever Wins
Is the US Economy Stuck in a 2% Growth Path? The most imposing economic challenge facing the winner of the Presidential election is getting the US economy back on a faster growth path. The economy has been seemingly stuck in second gear since the end of the Great Recession: the average annualised growth rate of […]
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