Salient to Investors:
Stephen Roach at Yale said:
- The fiscal cliff is moonshine, designed to make the politicians look good ‘saving’ America. We are not going to go over the cliff as even dysfunctional politicians know it would be political and economic suicide. Expect a phony deal of $10 trillion back loaded in years 8, 9 and 10, thus kicking the can down the road.
- The US doesn’t have the political courage to solve the big problems.
- We are still in a balance sheet recession.The economy will slog through and we are in the third innings of a nine innings paying down the debt – consumers were dealt a lethal blow by the bursting of the property and credit bubble
- Jobless rate will be in low to mid 7s in 2013 and many Americans looking for work on a longer term basis
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