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John Taylor says slashing the deficit as QE is ending will be an "unmitigated disaster" for the...

John Taylor says slashing the deficit as QE is ending will be an "unmitigated disaster" for the economy because of the combined hit to final demand. Once the pain is great enough, QE3 will become an inevitability, but getting there will be "pretty miserable."
Comments (7)
  • Slashing the deficit.....it won´t take effect this year...in fact the trillions will be years out I bet.....for sure until after the elections....if your economy is only based on government spending and subsidies..its time to change your economy I think...
    2 Jun 2011, 01:25 PM Reply Like
  • Mr Taylor must be a Democrat, or he would realize that another recession is what we're trying to trigger so we can get rid of Obama next election. Get with the program John. Your "unmitigated disaster" is just what we need . Short term pain worth the long term gain.
    2 Jun 2011, 01:31 PM Reply Like
  • Do listen to/read other news sources than Limbaugh & Kudlow, you know...
    2 Jun 2011, 01:42 PM Reply Like
  • There's no getting rid of obama, he will win by a landslide. The sheer amount of fraud all around guarantees that. Either way, civil tension and unrest will take it's toll. If he is re-elected, he will be at high risk of being overthrown, as that will be the tipping point.
    2 Jun 2011, 02:04 PM Reply Like
  • And you could probably do yourself a favor by flipping off MSNBC every now and then
    2 Jun 2011, 05:01 PM Reply Like
  • The economy will never turn around so long as Obama is in office.
    2 Jun 2011, 01:40 PM Reply Like
  • Here's some math I did today. By any reasonable assumptions, within 5 years the Debt to GDP ratio will be over 125% for the US, and....probably the most important measures.... interest in debt with be $1 Trillion a year vs. tax receipts of $3.25 Trillion. That means that interest will consume >30% of the tax receipts - leaving $2.25 Trillion for spending compared to $ 3.3 or so Trillion today. I'd call that a bust if you ask me. I'm beginning to think there is no way out and we've passed the tipping point.

     

    That's based on deficits of $1.5T, $1.5T then falling to $1.3T and never getting lower because of rising debt. With rising debts and rates, interest as a % of GDP will double from today's rate.
    2 Jun 2011, 06:30 PM Reply Like
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