Mandatory spending cuts and tax increases under what has been deemed the “fiscal cliff” is expected to have a substantial impact on the economy as a means to curb trillions of dollars in federal debt.
In an article from Bloomberg Businessweek, Bank of America Corp. (NYSE: BAC) CEO Brian Moynihan says the impacts of the fiscal cliff have already begun to take effect even months before policy changes are scheduled to occur.
Bloomberg Businessweek reports:
Bank of America Corporation’s (BAC) commercial customers are already reacting to the impending fiscal cliff, said CEO Brian Moynihan, as businesses have held off on buying capital goods until the Washington negotiations become clear.
“The impacts of the potential cliff are already being felt,” Moynihan said. In the bank’s survey of chief financial officers, “the number one issue they see is the fiscal cliff. They tell us it’s affecting their business plan. That uncertainty continues to hold back the recover. Simply put, our clients tell us they will not be aggressive in times of uncertainty.
The fiscal cliff will account for more than $600 billion of spending cuts and tax increases set to kick in beginning January 1, 2013.
Written by Jason Oliva