Saturday, December 22, 2012

Washington derailing nascent economic recovery

US consumer confidence took a hit in December, as the madness emanating from Washington is taking its toll.
Reuters: - U.S. consumer sentiment slumped in December as Americans were rattled by on-going negotiations to avert the tax hikes and spending cuts set to come into effect in the new year, data showed on Friday.

The Thomson Reuters/University of Michigan's final reading on the overall index on consumer sentiment tumbled to 72.9 from 82.7 in November, worse than forecasts for 74.7.

It also came in under December's preliminary figure of 74.5.

Talks to avoid the so-called fiscal cliff were thrown into disarray on Thursday evening when Republican lawmakers failed to back an effort by House of Representatives Speaker John Boehner that was designed to extract concessions from President Barack Obama.

The latest surveys indicate that this worsening sentiment will translate into declining holiday sales.
Reuters (different article from the one above): - About 17 percent of the 1,514 Americans who participated in a Reuters/Ipsos poll conducted December 17-20 said the impending "fiscal cliff" was making them spend less this season.
This comes at a time when the US economy was just beginning to stabilize and could be poised for a decent 2013. Manufacturing seems to have found a bottom (see discussion), home prices and sales have been improving, and income growth is showing positive signs.

Source: Econoday

CNBC's video below is fairly representative of the blame game going on in Washington at the expense of spending, business investment, and ultimately jobs. It is inexcusable.
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