Yesterday, Moody's Analytics Chief Economist Mark Zandi penned an article in Politico about the various possible outcomes of the looming Super Committee deadline. His remarks about the benefits of a multi-trillion dollar deficit reduction plan allow us to welcome him to the growing list of members in our Announcement Effect Club. Congrats! When referring to the prospects of a Go Big debt reduction agreement, he wrote:
"It’s too bad, because the economic payoff would be huge. Financial markets would rally substantially, and confidence and economic growth would surge. There might be appropriate wariness that this is too good to be true — but if it were true, our financial futures would quickly get brighter."
The Announcement Effect Club is one where merely showing the nation, the markets, and the world that we have a plan in place will provide economic benefits. Congrats to Mr. Zandi for agreeing with this notion. Now let's hope that our policymakers, particularly those on the Super Committee, heed this advice and enact such a plan. Time is running out, but the economic payouts, as Zandi notes, would "be huge."