Consumers feeling fear of fiscal cliff
The macro concerns are finally reaching everyday Americans.
Was Wednesday the day when it dawned on people that without a deal, consumers could be in real trouble? Was it the day when it hit the market that the regular guy is concerned?
I have to tell you that the comments from Wal-Mart (WMT), on top of the comments from Dollar General (DG) Tuesday about gross margins, tell me that everyday Americans are now starting to figure out they have to be worried, even if they are not sure exactly what to be worried about. They know we have a big budget deficit. They know, as they did when the debt-ceiling crisis occurred, that something bad is going to happen, and they know it might be something bad happening to them.
So that's who pulls back.
We may now be past the point of who is to blame and more to the place of "I don't care who is to blame -- do something." That's why, contrary to many people, I was quite contented with what Ben Bernanke is doing (read on TheStreet). He knows that sudden austerity is coming, and the last thing the country needs is a guy who is going to raise interest rates now because we had some good housing data. I think he recognizes how fragile the construction and auto rebounds are, and he needs to send a signal that he is not a Jean-Claude Trichet figure who wants to start raising rates as soon as possible.
It drove me crazy to hear so many people talk about how the real problem now is how Bernanke will get out of this position when things get better.
To me, what's pertinent is who is going to hire if everybody gets a tax increase and if instant and stupid spending cuts cause 2 million jobs to be lost.
Bernanke knows that austerity is good incrementally but hideous all at once and without thought. That's why he coined it a fiscal cliff, for heaven's sake. So don't blame him. He knows that consumer and business confidence is falling. He knows the cliff is coming.
He just wants to make the landing as gentle as possible, although when you jump from a cliff without a rope, the results tend to be less than optimal.
Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and has no positions in stocks mentioned.
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I believe we have to raise certain taxes, rich probably? They are not investing/spending or helping in the rebuilding in America's recovery...Much of the wealth has sailed from the shores...
Some of what is left, will have incentives to invest instead of hoard...Getting write-offs or deductions.
But in essence, everyone has to contribute a little more.
Then we have to slash spending to certain enitities....My favorite the Pentagon, DOD.
There are several others, but they top my bucket list...
We agree whole heartly in that respect...Mirage.
MG: There's a question of degrees at this point. With the degree of excess savings out there the growth triggered by tax reductions is likely very small. So if you want to fix the deficit right now, that's the low hanging fruit. There's much less collateral damage from taxes than cutting spending at this point. Both are really optional to handle at this very moment anyway. All the rating agencies have wanted was a credible long term plan that doesn't intentionally put us back into a recession.
When you address this from a the perspective of building small business, the thing they need more than anything else to grow is cheap interest rates. Most small business owners don't make a large enough sum of money to be impacted by the tax rate increases because they would need to have over about 300K in profits from their company per principal. Those that are are professional small businesses like accountants, lawyers, financial advisors, or doctors. Let's be clear, we're not talking about someone running a 5-6 man machine shop, plumber, electrician, small retail store, or just about anything else that comes to mind when we say "small busines." Those places, the ones that actually provide the most jobs, aren't impacted by this.
All that being said, it doesn't matter how much is done on the revenue or descetionary spending side, if we don't reform Medicare and add a rationing system to require some degree of efficacy and quality of life improvement to the treatments for the government to pay for it, we'll drown in medical debt.
And for the lower middle class. So what you wont be able to buy your 8 year old an i-idiot pad or an i-brain cancer phone. Give it up and grow up! I stand to lose some here too, but Whoopie Dooo!
It's only fake money anyway. Invented by lazy people who were afraid to get their hands dirty and wanted others to do the dirty work for them.
I have thought right along..There would be an "Eleventh Hour" deal, and have been banking on it.
Also believe there will be "stipulations" or "scapegoat clauses" that will enable both parties to return after the Holiday break and "tweek and fine tune" the so-called agreement.
dlh....We shouldn't send anymore weapons to the Middle East.....Friend or Foe...?
They always fall into the wrong hands...
No weapons of any kind...to anyone.
And apply sanctions to anyone that does.
Or arrest our suppliers and sellers.
There's going to be a deal, and it's going to come at the last possible second. I was really annoyed by that until I heard why. If negotiations end early and a deal is reached, whoever didn't get everything they wanted looks like they just gave up. In the environment, if the GOP allows the tax rates to increase without taking it to the edge, their constituency interprets that as them not fighting hard enough. If there are spending cuts impacting a broad number of people are agreed to before the bitter end, it's interpretted as Obama selling them out.
We're not talking about reasonable people that are willing to accept "This is the consensus we came to, and we jointly feel that this is a fair way to go." Both sides have rabid elements that will once accept giving up anything if it's right up against the edge of disaster.
MG......You can keep calling Hitler a socialist until the cows come back to the city...
But I'm going to keep believing, that Adolf....Strayed from his Marxist beliefs...AND many would
consider him a Dictator or Tyrant as he matured, until death.
The old "Absolute Power" problem, your buddy 57 States has not crossed over to the"darkside" yet.
Hitler had surpassed his Socialist attitude, long before the end..
I thought there would be a deal this year and am still optimistic. But, if no deal is struck by 12-31-12, there is another plan in the works that has worked to change politicians minds...the old style demonstration. I do not mean the kind that everyone does today via email, tweet, twack, etc., the real live in-person demonstration in front of Congress and the White House with thousands of us Middle Class folk, like me, that cannot stand it any longer.
Here's the date: August 28, 2013
Here's the place: Washington D.C.
The march: Middle Class Rights march on Washington
***MARK YOUR CALENDAR***
Not really sure I/we understand "all" ramifications of the "fiscal cliff", but I understand enough..
The term CLIFF bothers me; I have fallen over small hills or ravines...But all I have in my mind, is "Thelma and Louise" and that didn't end well or pretty...
We have several humungous(sp) figures,rates and amounts thrown around...
As an investor and a retiree....I feel something pressing against my back.
I hope the people (all) that make the decisions, feel the same thing...
My biggest concern is that we could default as a Nation again,be downgrade by all..And the WORST,
Go back into a deeper Recession......Losing everyhing for another 3-6 years.
It will take out the takers. not the makers.
Kinda think the term "socialist" included in the Nazi's name, may have been somewhat of a misnomer, unless you were of "pure Aryan blood"....Then take and destroy all or anything immigrants had acquired or built....Distributed to the Rich Capitalist/Industrialist that were left, supporting the War on Europe..
A reverse socialist conundrum ??....Actually one could say many were not really immigrants.
Even our own Joseph Kennedy, Ambassor to England....Wasn't really fond of the idea of attacking the Germans...But old Joe, had a Catholic/Jew thing going on also.
Until or maybe even after he was recalled back to the U.S.
I would have called it "trickle up economics."
Hey Boehner ---- NBC/WSJ POLL 75% say they are ok with raising taxes on the rich !!!
quote from mirage "Nazi' are SOCIALIST's, hello National SOCIALIST Party... Socialists are part of the left. Nazi's went after their Rich class (Jews)... "
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