Optimism over 'fiscal cliff' fix in US
WASHINGTON (AFP) - United States President Barack Obama quipped in Thailand at the weekend that a monk's prayers there might help the US economy dodge the "fiscal cliff," but divine intervention is looking less and less necessary.
Days after Mr Obama met at the White House with Democratic and Republican leaders to formally begin talks on avoiding steep automatic budget cuts and tax hikes, optimism has soared over a potential fix to a massive problem which if not resolved could send America tumbling back into recession.
After months of bitter feuding, senators and congressmen have expressed confidence over a deal that, in one form or another, would prevent US$500 billion (S$611 billion) in tax increases and spending cuts from going into effect at the beginning of next year and begin to ease the nation's deficit woes.
US stock exchanges soared on Monday, largely on hopes that politicians will get their act together and avoid a fiscal conflagration that will occur unless new legislation halts it.