Welcome to GuruFocus Investment Space.

Please Join Us to share your investment ideas with more than 100,000 GuruFocus users.

Join      Log in

smithpaul Blog

smithpaul's Space » All Blogs » View Blog

U.S. Debt Ceiling Crisis: Are you in Trouble?

191 views  2013-01-31 04:33   Tagsstock  deficit 
New York, January 31, 2013 - The current fiscal cliff is causing much concern not only between investors and business ownersbut also among the common mass. Apparently the first and noticeableimpact of the present U.S. debt crisis will be higher tax rates that will have a severe impact on the wallets of those belonging to the middle and lower classes. Besides this, experts have already made several other speculations on how the current U.S. deficit may affect the general populace. Considering the magnitude of the debt crisis experts believe that it may have both positive and negative effects.Talking about the advantages that people might get from the cliff, experts believe that there will be wide budget cuts which will ultimately lead to a moderate deflation on the price of goods and services which will work in favor of the consume for this year and beyond. Higher government debt will cause gasoline prices to go down as when budgets are tight people will prefer less travelling causing shortage of demand. Aviation industry may facesome changes as well as there might be long waiting periods in airports because of the time spent on the completion of all possible cost cutting measures. As a result of this, there will be possible delay in the arrival and departure of flightswhich will ultimately cause in the reduction flight takeoffsin order to avoid delays and completion of procedures efficientlywithin time. But less number of flights will lead to more demand for seats which will ultimately cause high air fares. Retail on the other hand may act in favor of the consumers as manufacturers may offer discounts in an attempt to encourage sales and boost falling consumer confidence. But this may increase more problems later as cheaper goods will be producedthat are low in quality which means low consumer satisfaction. Budget cuts willhamper quality checking as quality checking inspectors will be covering more duties and contribute less time in inspection.  Lack of quality inspection can be dangerous especially in foods and drugs which involves direct consumption. Thus by looking at the bigger picture experts presume that the current U.S.deficit will have an intimidating effect on the masses. read more news click here

Comments Comments (0 )



Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK