BlackRock's Fink puts U.S. fiscal cliff at top of his worry list
NEW YORK Oct 25 (Reuters) - The so-called fiscal cliff of automatic spending cuts and tax rises set to occur on Jan. 1 if Congress fails to act before then will be the most important issue facing the next U.S. president after the election, BlackRock Chief Executive Laurence Fink said on Thursday, saying there is a "very strong risk" of another U.S. ratings downgrade.
Fink, addressing a conference hosted by The Economist magazine, lamented that President Barack Obama and Republican challenger Mitt Romney did not address the cliff in their pre-election debates. Nonetheless, Fink sounded a more positive tone on U.S. economic prospects relative to Europe, particularly France, which he said is the most likely reason the euro zone would collapse.
Addressing the fiscal cliff, Fink, the chairman and CEO of the world's largest asset manager, predicted U.S. lawmakers would strike a modest $300 million to $400 million cut in the deficit before the end of the year.
"The most important issue affecting the next president will be how they deal with the fiscal cliff, and not one question from one of the (debate) interviewers ... was how are you going to deal with that," Fink said.
While politicians wait for the last moment to act, corporate CEOs are hoarding cash, which harms the economic recovery, Fink said.
- U.S. Mega Millions lottery up to $400 million, 2nd-biggest ever
- Uruguay becomes first country to legalize marijuana trade
- Pope Francis named Time's Person of the Year
- Thousands of South Africans line up to see Mandela lie in state |
- China bitcoin arbitrage ends as traders work around capital controls