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Congressional Budget Office Report

I’ve posted this link to a CBO Report that discusses why our politicians need to renew the Bush tax cuts and not decrease spending. Otherwise they predict we will see a recession in 2013.

(Just click anywhere in the article to be linked to the report)

There is a lot to this:

1. Do we really believe our politicians will do anything but bicker before the November election?

2. Will the people who believe the deficits were caused by the tax cuts agree to an extension?

3. Will the people who believe the tax cuts were only for the rich agree to an extension (the reality is that significant cuts were given to the lower end as well and those will expire, too)?

4. Will those that believe the trillion dollar deficits we’ve had the past few years will turn us into the next Greece agree to continue spending at current levels?

This is obviously a very complex issue with implications on the economy, employment, investment markets, and people’s everyday lives. So, I thought you should have an opportunity to read the report yourself.

As we move forward, we will obviously be keeping this thesis in mind during our portfolio management decisions. I don’t know if I buy into it completely, but our economic growth numbers are pretty fragile and any end to stimulus will certainly have an impact.

This is something that will dominate discussions for months to come.

Mark