CNBC reports: As the deadline for fiscal peril in the U.S.
nears, Wall Street is worried that the impact could be much worse than anyone
thought—while investors remain nearly oblivious to the danger.
Looming tax increases and spending cuts — which Federal
Reserve Chairman Ben Bernanke has labeled the "fiscal cliff" — would
send the economy into a deeper recession than many have predicted, according to
economists at Bank of America Merrill Lynch.
At the same time, fund managers the firm surveyed believe investors are
far too optimistic that warring Washington factions can get together to take
the steps necessary to prevent the economy from going over the cliff—at least
temporarily.
Some 72 percent of respondents believe investors have yet to
price in the ramifications—a view that is spreading across Wall Street as time
winds down for a solution……
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