Another downturn may hit US economy
Thursday, 29 April 2010
From Fazle Rashid
NEW YORK, April 28: United States, the world's largest and strongest economy, may face another crippling economic downturn unless it takes immediate steps to rein in its structural fiscal deficit. Greece's rescue package of euro 45 billion, many fear, will fail to prevent its debt crisis from spiralling out of control. The experts strongly feel that Greek crisis could spread and "have knock-on effects on global economy."
Contagion is worsening, an analyst said. This is going to require people of both parties to come together and take a hard look at the growing fiscal gap, President Obama was quoted as saying. A bipartisan Debt Commission is already working on the issue. Obama has told the commission to put everything on the table and Fed Chairman Bernanke suggested overhauling the nation's tax code to raise more revenue, the New York Times in a report said today.
The Republicans are against raising of taxes. The President said that he had inherited a deficit of $1.3 trillion with debt projected to rise by $8 trillion over the decade and that he had taken steps to restrain its growth despite a recession. But he conceded it is not enough to avert a calamity, the NYT in a report said.
The 18-member Debt Commission comprises 12 members -- six each from the House and Senate equally split between Democrats and Republicans. All of Commission's recommendation must have the endorsement of at least 14 members before they are sent to Congress. The Republicans will have the power of veto.
Republicans thwarted the Democratic Party's efforts to overhaul the financial regulations for the second day and floated an alternative proposal with some vital difference in regulations of consumer lending. Democratic accused the Republicans of demanding that the parties resolve their differences in close door negotiations before placing the bill in the Senate.
Financial markets in the US and Europe were rocked yesterday after Greece's creditworthiness was cut to "junks" by the Standard and Poor's deepening fears that a debt crisis in Europe could spiral out of control
It is not Greece alone that is in need of huge infusion of fresh cash merely to survive. The condition in Portugal, Spain and Ireland is no better.. Portugal also saw its credit worthiness being downgraded by the S&P. Euro saw a 13 percent decline against dollar. The Down Jones industrial average slumped 213.04 points.
Europe's budget deficits are worsening. Europe's paralysis in dealing with Greece is driving the unease and highlighting political division within Europe.
NEW YORK, April 28: United States, the world's largest and strongest economy, may face another crippling economic downturn unless it takes immediate steps to rein in its structural fiscal deficit. Greece's rescue package of euro 45 billion, many fear, will fail to prevent its debt crisis from spiralling out of control. The experts strongly feel that Greek crisis could spread and "have knock-on effects on global economy."
Contagion is worsening, an analyst said. This is going to require people of both parties to come together and take a hard look at the growing fiscal gap, President Obama was quoted as saying. A bipartisan Debt Commission is already working on the issue. Obama has told the commission to put everything on the table and Fed Chairman Bernanke suggested overhauling the nation's tax code to raise more revenue, the New York Times in a report said today.
The Republicans are against raising of taxes. The President said that he had inherited a deficit of $1.3 trillion with debt projected to rise by $8 trillion over the decade and that he had taken steps to restrain its growth despite a recession. But he conceded it is not enough to avert a calamity, the NYT in a report said.
The 18-member Debt Commission comprises 12 members -- six each from the House and Senate equally split between Democrats and Republicans. All of Commission's recommendation must have the endorsement of at least 14 members before they are sent to Congress. The Republicans will have the power of veto.
Republicans thwarted the Democratic Party's efforts to overhaul the financial regulations for the second day and floated an alternative proposal with some vital difference in regulations of consumer lending. Democratic accused the Republicans of demanding that the parties resolve their differences in close door negotiations before placing the bill in the Senate.
Financial markets in the US and Europe were rocked yesterday after Greece's creditworthiness was cut to "junks" by the Standard and Poor's deepening fears that a debt crisis in Europe could spiral out of control
It is not Greece alone that is in need of huge infusion of fresh cash merely to survive. The condition in Portugal, Spain and Ireland is no better.. Portugal also saw its credit worthiness being downgraded by the S&P. Euro saw a 13 percent decline against dollar. The Down Jones industrial average slumped 213.04 points.
Europe's budget deficits are worsening. Europe's paralysis in dealing with Greece is driving the unease and highlighting political division within Europe.