So, what are the terms of the bill that was passed by Congress and signed by the President
Last month? “All bark, and no bite!”
Similar to August 2011, Congress and the President waited until the final minutes of the 11th hour to pass a bill yesterday to extend the Treasury’s borrowing authority through February 7, 2014 and avert the first ever default in U.S. history. The bill also funded the government through January 15, 2014, thus ending the 16-day long partial shutdown. Additionally, it directed House and Senate negotiators (Super Committee II) to work on long-term structural budget issues, such as entitlement and tax reforms, and come to an accord by December 13, 2013. The House Republicans gave up their fight to defund or dismantle Obamacare, for now. The only Obamacare-related concession they got was a provision to tighten income-verification requirements for people who receive health-insurance subsidies from the government. Estimates of the economic impact of the fiscal impasse vary from 0.3% to 0.6% reduction in Q4 real GDP growth at an annual rate.
Despite its immediate positive impact, the bill provides only a temporary solution to the crisis.
The new deadlines set the stage for another political showdown early next year. This crisis mode of fiscal policy making has a negative impact on both business and consumer sentiment, which could result in lower investment and consumer spending, thus ultimately reducing economic growth.
Source: Ned Davis Research
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Becky Von Holten
Market President-Midland State Bank
Becky is an experienced financial professional with a diverse and impressive background. In her role as Market President for Midland States Bank in Champaign, she is responsible for the management and leadership of both the bank and wealth management growth in the Champaign, Illinois market. Prior to joining Midland States Bank in 2009, she was a Financial Advisor for a major Midwestern regional bank holding company where she also held senior level retail positions. Becky attended Heartland Community College in Bloomington, Illinois, and Illinois Valley Community College in Oglesby, Illinois. She also holds her Life, Accident and Health insurance licenses in the State of Illinois. Becky lives in Mahomet, Illinois with her husband, Rick and their three children, Sarah, Andrew & Adam.
