It already has – markets have partly priced in the automatic cuts. But Washington's partisan deadlock causes ruinous uncertainty. Last week, Federal Reserve Chairman Ben Bernanke, a man of endless accommodation, drew a hard line under the one thing he could not do to save the US economy. Bernanke told the press: "If the 'fiscal cliff' isn't addressed … I don't think our tools are strong enough to offset the effects of a major fiscal shock." The warning was clear: a "fiscal cliff" could cause the Lehman moment of all Lehman moments. It didn't even send a ripple through Washington. Congress went on campaigning and ... (full story)