â??Fiscal Cliffâ?? casts shadow over northern Michiganâ??s economy
Uncertainty. It might just be the best word to describe the so-called â??fiscal cliff.â??
Drastic spending cuts and tax hikes are set to kick in at the end of the year, if congress doesn't come to terms on a new budget.
Experts say this may trigger another recession. Thatâ??s bad news for a country that is already swimming in debt.
â??It's just like a household who has a credit card that they are just using like crazy and they've reached the point where they can't use it anymore. Theyâ??ve reached their limit and they have to start paying it back,â?? said Michael Reese, financial advisor.
Reese tells 7&4 News, while policy makers fight in Washington, northern Michigan families are uncertain of how to invest in their own portfolios.
â??A lot of people are asking, should we be pulling out? And you know what, I can't say don't do that. I think there is a lot of merit in actually saying, hey, we should hit the sidelines until we see what is going to happen,â?? said Reese.
The Traverse City Area Chamber of Commerce is worried that wealthy investors, who want to invest in local companies, will shy away because they don't know which policies will be in place come January.
â??If you are looking at investing locally, and you are worried that your portfolio is going to get cut in half because of things that happen to the market as a result of fiscal policy, your are not going to invest that money. Youâ??re going to hoard that money; you're going to move it out of the market,â?? said Doug Luciani, Traverse City Area Chamber of Commerce.
Congressional leaders are scheduled to meet again after thanksgiving.
They said a deal will be finalized by December 31st.
Right now, the biggest sticking point is said to be tax cuts for the wealthy.