"If you're going to panic, do it fast and beat the crowd." ~ Jesse Livermore

Tuesday, December 4, 2012

Avoiding a New American Recession

Avoiding a New American Recession by Martin Feldstein - Project Syndicate: "President Barack Obama’s proposed alternative to the fiscal cliff would substantially increase tax rates and limit tax deductions for the top 2% of earners, who now pay more than 45% of total federal personal-income taxes. His budget would also increase taxes on corporations, and would end the current payroll-tax “holiday,” imposing an additional 2% tax on all wage earners. Together, these changes could lower total demand by nearly 2% of GDP. And the higher marginal tax rates would reduce incentives to work and to invest, further impeding economic activity. All of that could be fateful for an economy that is still struggling to sustain a growth rate of less than 2%. The Congressional Budget Office and the Federal Reserve predict that going over the fiscal cliff would cause a recession in 2013, with Fed Chairman Ben Bernanke recently saying that the Fed would be unable to offset the adverse effect on the economy. He could have said the same thing about the fiscal drag that would be created by Obama’s budget proposal. . . . "

Euro zone debt crisis to run and run, says QNB Group
CPI Financial
Despite a recent agreement by the Euro group and the IMF on releasing further assistance for Greece under its bailout programme, the outlook for Euro zone economies remains weak and the region's sovereign debt crisis is likely to stay with us for a ...

Analysis: Greek deal puts euro zone in slow recovery room
Reuters
Monday's EU-IMF agreement to keep Greece afloat inside the euro zone, by reducing its debt now and hinting at official debt relief to come later, has removed the biggest risk of a financial shock that could re-ignite market panic and send the euro back ...

ECB and BOE rate decisions to grab attention
MENAFN.COM
Both Spain and Italy had announced that they completed all the funds needed for 2012, where the upcoming auctions are all for 2013 financial requirements, lowering the chance of tapping the ECBs OMT program this year. ... Moving to the U.K., the ...

Austria's Fekter sees no need to top up ESM bailout fund
Business Recorder (blog)
Moody's cut its rating for the European Stability Mechanism and sister fund EFSF following its downgrade of France in November, noting a high correlation in credit risk among the rescue funds and their largest financial backers. Fekter, one of the ...

Business Recorder (blog)

OECD cuts global economic forecasts over euro zone risks
Trade Arabia
The Organisation for Economic Cooperation and Development slashed its global growth forecasts on Tuesday, warning that the debt crisis in the recession-hit euro zone is the greatest threat to the world economy. In light of the dire economic outlook ...

Trade Arabia

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