'Fiscal Cliff' as the New Y2K? Threats May Be Overstated |
| CNBC - Nov 15, 2012 |
Is Wall Street freaking out too much about the "fiscal cliff"?
It has appeared that way at times in the week since President Barack Obama's re-election cast urgent attention on the need for a budget compromise before $600 billion in automatic tax increases and spending cuts kicks in.
Here's a handy way to determine what might cause financial markets to overreact to an approaching event: figure out what economic surprise last made a number of smart people feel stupid for having underestimated its potential for market mayhem.
The last episode that humbled many astute economists and investors was the standoff in Congress in the summer of 2011 over raising the nation's borrowing limit. Debt-ceiling votes were widely viewed as procedural necessities, and the notion of inviting a potential government default was unthinkable to rational analysts, leading them to assume cooler heads would prevail.
Read Full Article from CNBC
- Posted: 2012-11-15 12:33:54
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