Best Thing is go Straight off Fiscal Cliff-Karl Denninger
By Greg Hunter’s USAWatchdog.com
Analyst Karl Denninger says, “The best thing we could do as an economy is go straight off the fiscal cliff and not come back because that would take about half of the deficit off the table immediately.” The reason why the U.S. deficit is so large, according to Denninger, “Both sides want to spend more than they take in in taxes.” Denninger says the Federal Reserve enables the U.S. to live well beyond its means. Denninger contends, “The $85 billion a month the Fed is putting into the system enables deficits and spending. . . . When you debase the currency in this fashion, there is no free lunch.” One thing that needs to be fixed is the Alternative Minimum Tax (AMT). Denninger says, “It is going to hammer tens of millions of middle class families that have never had to pay it before.” Instead of a tax refund, some middle class families might owe a few thousand dollars in 2013. The AMT might get a patch, but Denninger thinks, “There will be no deal on the Fiscal Cliff by January 1st.” Join Greg Hunter as he goes One-on-One with Karl Denninger of Market-Ticker.org.
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About the Author
Greg Hunter
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.
1st, Merry Christmas to you & your whole family Greg, also to all of those have found your site that are your family also! As a loner & you have proved yourself & staff to deliver the truth as it really is, no bull just well vetted data & up close interviews from the people whom also are on the front lines of worldly every day life!
The fact is that Carl is telling the truth, there is no deal & it’s SOP for DC! You know we in are deep crap when the gov puts up a you tube site ‘for how to’ ‘qualify for bennies’! Now if it were congresses/corps/bankers life savings & pay checks funding those bennies ‘there would not’ be a red cent to fund it or a site, right?! Go figure!
This will be another Christmas with our troops away from love ones & we must support them!
Thanks again Greg.
Mickey Smith
Thank you Mickey. Merry Christmas to you and yours.
Greg
I hope Denninger is correct. The spending is absurd. The bleeding must be stopped. If we put the members of Congress on a commission instead of a salary, and paid these greedy criminals only on what they reduced in expenditures – we’d probably be out of the hole a whole lot quicker.
Seasails,
Thank you for joining the discussion!!
Greg
I disagree with Mr. Denninger, of course, who am I to do that, just an average Joe. Having said that, I do know we have the best politicians money can buy and they always come through with “deals” to benefit themselves and their secret interest cronies. The fact that no one talks about the FED’s printing/devaluation of the dollar game tells me they do not really want to fix anything systemically. But a deal will be done, you can bet on that, but it will be just icing over a plastic cake; looks great but you can’t eat it. Watch for the New Years Eve parties in Washington with photo ops all around. One other thing you can bet on is at those parties the champagne & caviar will be paid by the average Joe’s.
Art,
Thank you for bringing your point of view to the table. It is appreciated. Merry Christmas to you and yours.
Greg
Greg, I almost forgot, thank you for your site, have a special Christmas this year. Sincerely Art B.
No kidding….
It’s good to be King.
President Obama clearly reached the end of his negotiations with Boehner – He threatened to use the inaugural address and his State of the Union speech to let us all know Republicans were to blame.
Boehner put $800 Billion in tax revenue on the desk in the oval office.
What did he get for that?
Zero, Zip and Nada… nothing.
Nothing happens and that $800 Billion is a freebie when Bush tax cuts expire.
So Obama walks the beach and ponders (joking, of course) just why the Bush Era Tax cuts increased Tax Revenues from 2004 to 2007 by $785 billion, the largest four-year increase in American history.
No deal is THE Deal, the real deal for 2012. The end of this untoward saga comes to a close when the sleeping masses of Americans droned to distraction begin to realize they were fooled again…. well… maybe.
They will however feel it all around them as Taxes increase across the board and the standard of living, nose dives once again.
(as an aside – all of the PM cheerleaders from the NB thread…. Oops.)
JRMFL, Claude, Jim, Gary, and Rev. Thank you all for weighing in in Christmas Eve. Marry Christmas to one and all!!!
Greg
Mr. Hunter, I frequently read articles from your site and I must say they are very interesting. Your research and your guests add quality to your posts. I wish you a Merry Christmas to you and your family.
P.S.
Mr. Hunter, it’s Christmas Eve and fiscal cliff is not set. But it is better to laugh. Here is a link to a joke about fiscal cliff.
http://www.jumpystocks.com/2012/madbanks-cartoons-dec-16/
Thanks Greg for your time and effort.
I agree with Karl.on going ahead off the cliff. I don’t agree we should use this to tweak a crap system that has always profited a few people on the same team (despite staged differences) and left everyone else in thousands of factions against one another hoping to make the grave with a nickel in their pockets. In a world where the words hedges, derivatives, markets and interest (to name only a couple) out weigh words like love, compassion and oneness, sound minds should see the cart before the horse. Gambling is now considered “hard work” in place of the hard teamwork that once made this country great. At 59 years old I see for profit as the disease it is. Whether Communist, Socialist or Capitalist, for profit benefits a few leaving no room for teamwork or oneness. I don’t have the answer except in my own beliefs and actions. I have managed to find many kindred Spirits whose guts tell them too that we are way off course.
This is not sour grapes as my family has done well and will (I think) have that nickel at the end. It’s just the older I get the more I seem to care about my fellow men and women. Maybe that’s a good thing.
Peace and health to all as we say hello to 2013.
Obama is wetting his pants over this cliff. He loves it. Speaker Boughner is a joke, never once confronted anything, no leadership. Its going to be great seeing all the celebs piss and moan over their new tax rate!
I’m with you Greg. Thelma and Loise it! lol! Merry Christmas!
Well, if what Mr Denninger says is true and basically our “fearless” leaders have but 1 day to come up with a plan I’d say they will just try and cover the AMT problem with a patch and call it a Happy New Year. 🙂 Noooo way these clowns get things done. The market is “obviously” expecting a solution to the whole problem but Mr Denninger gave some helpful info about ways the politicians might be able to “wiggle out of it” like they always do. I certainly hope the Middle Class doesn’t get hit with more taxes. Actually, maybe I should as the more taxes the middle class are required to pay the less likely they are to pay the $170K mortgage on their $125K houses. Then we can get to the final drop that takes that to oooh, I dunno….$80K? Then we “approach the solution” at warp speed *-)Greg, you need to spread the word that even folkes who are behind on their mortgages have a tremendous amount of buying power in their mortgages. Get folkes to just stop paying and America will be rockin! :-)As always, consult your “financial professional” before making ANY investement decisions on undergoing dramatic changes to your portfolio…specially if you are planning on losing half your bankroll as quickly as possible. Merry Xmas to all…and to all, a good night.
DO IT, DO IT, DO IT!!
Americans should all be screaming for our elected officials to do the right thing — which happens to mean doing….NOTHING!
The only people who are possibly against this are boomers that want to keep taxes low until they leave the workforce — leaving my generation with an even bigger mess to clean up.
Greg,
Merry Christmas to you and your family! Merry Christmas to everyone!
Here is an interesting article:
“’Pinocchio Effect’ Confirmed: When You Lie, Your Nose Temperature Rises” (http://www.sciencedaily.com/releases/2012/12/121203081834.htm)
Too bad there is no thermal imaging camera installed in the U.S. Congress or we would see our Congressional members’ noses glow like Santa Claus’s reindeers. Congress will look like a magic light show. A thermal imaging camera would be an indispensable tool for any news reporter who seeks the truths – although I doubt that any MSM would be brave enough to use it, especially the FOX news crew.
Don’t worry about the fiscal cliff. When the time comes, we are going to follow the clueless in Washington and jump off the fiscal cliff like Lemmings.
Ambrose
Ambrose,
Love the comment and the link!! Thanks.
Greg
I am in a local that has the slowest Video email in the world. Is Karl’s desertation available via transcript?
Have a nice holiday season. Thanks for your web page and participants. Mel Taggart
No Mel. I do not have the staff to transcript every interview. So sorry. Thanks for the comment and for your support.
Greg
Greg,
Mr. Denninger’s interview was quite the Christmas downer.
As one of those millions of household (we make a joint income of about $50,000) likely to get hit hard by the Alternative Minimum Tax (AMT) that he spoke of, I hope you will help keep us abreast of what’s happening on this front. Living in a poor rural area, I can think of countless young families and older working families that what Mr. Denninger portends would be absolutely devastating to them. It would be like the final nail in the financial coffin for struggling families. Here there are many struggling families.
I appreciate the foresight and forewarning that this potential lies out there, but I would appreciate any more if you could help us keep up with news on this front.
Thank you for all you do, Greg!
Maybe you don’t realize how many of us have come to rely heavily on your dedication and effort to keep us informed — or how much we appreciate it.
I wish I could say “Happy New Year,” but somehow “happy” just doesn’t seem to fit all events that could be coming in the new year.
God bless you, Greg.
Rebecca,
Thank you very much for your kind words and for your support. I am hoping for at least an AMT patch but who knows? This is a gigantic political mess and it is very dangerous to the stability to the U.S. I can’t help to think the U.S. credit rating will get another downgrade soon. We have bag-men not statesmen in Washington D.C. I don’t like giving bad news but people must be informed to protect their families from politicized incompetence.
Greg
I’ll be shocked and amazed if either side ignores this golden opportunity to grow government. Most Americans are hoping they will grow government to make the “fiscal cliff” vanish just as they do with every consequence of fiscal irresponsibility.
-Jeff
Jeff,
I agree but we all know here that at some point we get a cliff dive no matter what. Fixing this economic mess will be painful, and the longer we put it off the more painful it will be. Merry Christmas!!
Greg
Merry Christmas to you and yours Greg. This deal with the AMT holding up tax refunds may be the spark that finally wakes everybody up. There will be rioting in the streets over this. Prior to this point, it was always somebody else’s money that was being affected. Now those that count on their refunds to pay other taxes, put food on the table during the winter, pay their utility bills so there’s fuel oil in the tank, among a whole host of other required spending, won’t be getting that money. This is HUGE and there will be millions of very angry citizens looking for someone to blame.
Good point Richard. Thank you for making it here. Merry Christmas.
Greg
Merry Christmas Greg and another enlightening New Year,
If you are Obama the cliff is perceived a little differently. The military cuts would not be his doing and the Bush tax cuts would disappear leaving room for the –TA-DA — Obama Tax cuts !! ( minus the evil rich of course) — which of course would just be a renaming . His real legacy though will be all the new ghettos to come all named “OBAMAVILLES”.
Martin,
I think we are headed over the “Fiscal-Cliff.” I though for months that getting a deal was a long shot. “Obamavilles” You don’t think the MSM would brand them that do you? You are spot-on though!!!
Greg
A slow death of the dollar is more painfull for those depending on it.However a slow death is better,and more prefered by those not affected by the death of the dollar. Slow death gives more time to prepare for the expected.Just a thought…Not sure i buy it either.
I’ve been following the news related to the fiscal cliff and its development even though I don’t live in the US but in Canada. As a Canadian investor working in real estate I’ve been analyzing the possible risks in this particular sector and the outlook for 2013 is quite optimistic as far as the real estate market in Canada is concerned. However, there are certain threats that could put a halt to that positive development, one of them being inflation pressures out of the US. The mutual interconnection between the two countries is very strong so I hope the US government will do its utmost to prevent the worst from happening.
Getting caught up on here. Its 11am on the West Coast on the 31st. I dont think these guys are gonna do anything. If the AMT isnt cleared there are going to be a lot of shocked middle class folks. As for the payroll tax, cutting that was stupid then and its stupid now. Although I think that gets restored no matter what??
Shawn,
I think they will fix the AMT at the least. That tax is trouble for BOTH parties.
Greg