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Going Over The Cliff

Fascinating interview this morning with Erskine Bowles (Former President of UNC so he’s a Tar Heel) and Warren Buffet on CNBC.  Bowles is the architect of the National Commission on Fiscal Responsibility and Reform with Alan Simpson.  Basically a plan to turn the country’s spiraling debt problem around.

When asked what he thinks will happen, Bowles said it’s likely that we’ll go over the cliff.  He said it calmly with a smile, but he did confirm that it does appear that we will go over.  Over the cliff is irreversible debt, the country goes bankrupt.  That’s not good, but what does it really mean for us?

I think it probably means that they finally are forced to do what’s right and cut spending.  Over the long haul, this is making business conditions more difficult than they have to be.  Too bad for all of us.  Better conditions with less debt dragging down business would be great.  But as Buffet said at the end of the interview, I’m not worried, they’ll do the right thing eventually.  It would just be smart to do it earlier.  I’m sure he is right as well.  I don’t want to go over the cliff, but in this country I’m not real worried about it either.

Todd Kmiec

Todd Kmiec and Associates

todd@toddkmiec.com 

  1. GAry
    July 12, 2012 at 6:36 pm

    Buffett has enough money to ride things out. So saying they will do the right thing eventually, who is they. We have not seen it so far and I have little faith in the current administration, congress and the Senate that they will fix things. I am sure the majority of the people of this country are not too favorable with what is taking place. I had some investment [property, because of the recession and ongoing recession and housing market I lost it, pockets were not deep enough. It was only a quarter million out of pocket. This country needs to start turning things around now and the only way it is going to happen is for people to get out there and make it happen by climbing all over their representative. They are more interested in keeping their positions then working for the people. From my perspective we have no say as to what our elected officials do except at the ballot box.

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