Skip to main content

failure

Krugman:
Bloomberg today has an interesting twist: U.S. Futures Decline on Concern Supercommittee Won’t Agree on Budget Cuts. In reality, US rates are down, suggesting no increase in debt concerns whatsoever.

But if you read the Bloomberg piece carefully, what it actually says is that market players fear that the absence of a debt deal means no stimulus. So the actual fear is not that spending won’t be cut enough, it is that it will be cut too much—which actually makes sense, and is consistent with the action in stock and bond markets.

Ezra Klein:

There’s no real reason for the market to care whether deficit reduction comes through “the trigger” or through a supercommittee deal. It’s about $1.2 trillion either way. If you’re worried about how much debt the United States is carrying around, the supercommittee’s failure changes nothing.

But from the perspective of near-term stimulus, and thus next year’s economic growth, the supercommittee’s defeat could change quite a lot. As JP Morgan’s Michael Feroli writes, “The real near-term fiscal issue is the expiration of certain temporary support measure at the end of the year, in particular the payroll tax holiday and emergency unemployment compensation. While the fate of those measures are not directly tied to the supercommittee, this week’s failure to come to an agreement probably reduces the likelihood some that those programs get extended, and thus we can expect a noticeable drag from fiscal consolidation early next year.”

David Dayen:

The collapse of the talks has nothing to do with the stock market. Europe is leading the world to depression. US lawmakers failed to replace $1.2 trillion in budget cuts with some other $1.2 trillion in budget cuts. Either way, there will be $1.2 trillion in budget cuts. Every rating agency has come out and said that this will not have any impact on US long-term borrowing rates. And even if they did, like Standard and Poor’s did earlier in the year, it had absolutely no impact on those borrowing rates. In fact, those rates plunged even lower.

It's awfully difficult for TV pundits to keep up, particularly the ones in DC, but the Super Congress failing just doesn't mean much. What matters is that we still have a shitty economy and austerity isn't working. Also, too, Europe.

EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site