Does the Fiscal Cliff Need a Road Trip?
Every other headline coming out of Washington paints the fiscal cliff discussions in a different light. One moment policymakers obtain a moment of clarity and take a step forward, and the markets trek hopefully upward as a result. Other times, such as at the beginning of this week, progress is drowned in finger pointing and the markets heave a collective sigh of frustration and begrudgingly enter bear territory.
It’s not fair to say that the U.S. equity markets are absolutely shackled to the progress of the fiscal cliff discussions, but investors, traders, and business leaders all recognize the massive ramifications of the decisions that must be made and are all affected by the uncertainty that fogs Wall Street as a result. On Friday, market participants will be watching as President Barack Obama packs up his proposal and takes it on the road in hopes of spurring some progress in the discussions.
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Obama will be taking his message to Hatfield, Pennsylvania, where he will speak at a toy manufacturing facility run by Michael Araten, a CEO that donated to Obama’s campaign. Obama will be pitching his balanced-approach solution to the fiscal cliff and ostensibly rousing the public to pressure policymakers into action after the President’s most recent proposal was shot down by Republicans.
On Thursday, Speaker of the House John Boehner said that “going off the fiscal cliff will hurt our economy and it will cost American jobs.” His expectation for what will happen if a solution is not found is clearly frightening, but it’s also clear that Boehner and many in the Republican camp are frustrated by the President’s proposal.
That proposal includes…