Global

washingtonpost.com

Uncertainty over whether Washington will agree a spending and taxation deal that is crucial to keeping the U.S. economic recovery on track kept a lid on global market gains on Monday.

Economists have said the U.S. risks slipping into recession if hundreds of billions of dollars in expiring tax cuts and automatic spending reductions take effect on Jan. 1 — the so called “fiscal cliff.” Congress and the White House must find a compromise to prevent a big hit to the world’s biggest economy.

President Barack Obama, fresh from a re-election victory, and House Speaker John Boehner have spoken of compromise but appear to be taking a firm stances on some issues, including whether to raise taxes for the wealthiest.

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Image: Pedestrians walk past graffitti in Athens – a growing number of Greek workers remain nominally employed but have not been paid for some time. Photograph: EPA

guardian.co.uk - October 31st, 2012 - Julia Kollewe and Phillip Inman   

Unemployment in the eurozone has risen to a new record, with more than one in four out of work in Spain and Greece.

There are now 18.49 million people without jobs in the 17 countries sharing the euro, said the European statistics office Eurostat on Wednesday with an extra 146,000 joining the ranks of the unemployed last month.

Youth unemployment – joblessness among under-25s – rose to 23.3%, up from 21% during the same month a year ago.

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reuters.com - November 4th, 2012 - Krista Hughes and Julien Toyer

Finance chiefs of leading economies pressed the United States on Sunday to avert a rush of spending cuts and tax hikes that could hurt global output next year, though some countries still saw Europe's debt crisis as the No. 1 danger.

Unless a fractious Congress can move quickly to reach a deal after Tuesday's U.S. elections, about $600 billion in government spending cuts and higher taxes are set to kick in from Jan. 1, threatening to push the American economy back into recession.
   
"They need to act swiftly on the fiscal cliff and then they will need to put in place a medium-term fiscal consolidation," Australian Treasurer Wayne Swan told Reuters before ministers from the Group of 20 countries gathered for talks.

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