Wednesday, January 2, 2013

Fiscal Cliff Compromise Reached - A Look Ahead To The Debt Ceiling

After 60 days of 24/7 discussions from the mainstream media, we have a compromise. I spent only about 3 sentences on this site over the last two months discussing the fiscal cliff asking readers to please do the following.

Completely ignore the entire discussion. Spend your time reading or listening to something that has real world relevance. A compromise will be reached.

This advice turned out to be my best of 2012 as the "brave" political leaders of America came together like the true heroes they are at the last minute to "save" the country.

Why did I believe a compromise would be reached? A compromise means that no tough decisions are made. The small fraction of tax increases compared to the total size of the real problem, spending, is laughable.

With no changes made on spending, the real problem is now pushed back to the next "end of the world" deadline - the US debt ceiling, which we crossed on New Year's Eve.

Look for a repeat of the summer of 2011 when politicians say that any cuts on spending would be the equivalent of "taking the food money out of the mouths of starving children and removing the needed medicine for older people in America." Remember those quotes?

My advice?

Completely ignore the entire discussion. Spend your time reading or listening to something that has real world relevance. A compromise will be reached.

The day of reckoning will come. It will occur the day we wake up and the bond market says "no more" to the children that currently reside in Washington. Then you will see the complete disintegration of a society dependent on trillion dollar deficits and 0% interest rates. That is something you do not want to ignore as it is very real and it is coming.

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