United States fiscal cliff - think hard about it now and on November 6

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An article last Friday says that the tax hikes and spending cuts that will result after December 31 if Congress does not take action to avert those scheduled changes (broadly referred to as the 'fiscal cliff') have already in 2012 resulted in one million U.S. jobs being lost - and will result in loss of a further 6 million jobs through 2014 and a reported U.S. unemployment rate of 12%.

I don't know whether the data set out in the article has any validity, but even if directionally correct it emphasizes the importance of the election results on November 6. Anyone with money in the financial markets ought to be glued to their television sets that evening as the election results are reported. Simply put:

Whether you agree with my assessment of this or not, I suggest you think hard about it, and do so in a very apolitical way. Whatever your conclusion then is, review your trading and investment positions in the context of that conclusion.

You might want to read 'Fiscal cliff' warnings rise to (overblown?) fever pitch. That article, which includes reference to job losses and dire predictions, states expectations in keeping with my comment about 'saner heads prevailing' that almost certainly will happen. In other words, a balanced expectation is that the potential severity of fiscal cliff consequences will thaw any Washington polarization at least to enable the 'fiscal cliff' issues to be dealt with on a timely basis.

That said, recall the July/August 2011 U.S. debt ceiling impasse. The required 'fiscal cliff' negotiations may in the end be similarly conducted. Also recall that S&P downgraded U.S. debt concurrent with those 3011 debt-ceiling negotiations.

Topical Reference: One Million Jobs Already Lost Due to Fiscal Cliff, from The Fiscal Times, Lori Montgomery, October 26, 2012 - reading time 4 minutes. Also read 'Fiscal cliff' warnings rise to (overblown?) fever pitch, from Economy Watch NBCNews.com, John W. Schoen, October 26, 2012 - reading time 2 minutes.