Goldman Sachs gets scary

The Big Investment Bank has published a graph showing its forecast for the amount of damage a sequester will do to the economy. 

Believe me, you don't want to know.  You just need to sell your home,  bundle your bucks into a suitcase, and run for the airport NOW.  That way you may have just enough time to exchange those bucks in your country of choice for a more durable currency and a more secure home before the trouble hits in.  While you're packing, practice your French, your Italian, your Canadi-an -en, your Bahasa Melayu ... whatever. ...

“On Friday,” writes Alec Phillips, an economist at Goldman Sachs, “we lowered our outlook for federal spending, to take into account the increased likelihood that cuts under sequestration take effect.” ...

... “Sequestration, spending caps, and reduced war spending will together reduce real federal consumption and gross investment by 11% over the next two years,” writes Phillips. Ouch. That’s a very big drop in a very weak economy. ...Ezra Klein, WaPo

And Klein adds this killer reminder if you're still hanging round here and reading rather than packing:

Something to remember about the sequester is that part of the reason it was never supposed to happen is that it’s not backloaded. That is to say, where most deficit-reduction proposals have been structured to deliver their heavier cuts in years five-10, when the economy is further along in its recovery, the sequester’s cuts in year one are of the same magnitude as the cuts in year 10. That is to say, from the perspective of the recovery, it’s a particularly nasty and dumb approach to cutting spending. ...Ezra Klein, WaPo

Comments

[SteveAR]

"You just need to sell your home, bundle your bucks into a suitcase, and run for the airport NOW. That way you may have just enough time to exchange those bucks in your country of choice for a more durable currency and a more secure home before the trouble hits in."

You first. I think Cuba or North Korea might be acceptable to someone like you. And they have all kinds of gun control; since you would become one of the peasants, your owners won't allow you a right to arm yourself, nor pretty much any other rights, like eating.