Fed Officials: U.S. Heading for 'Fiscal Cliff' at Year's End

(Newsroom America) -- The U.S. economy is heading for a "fiscal cliff" by the end of the year of mandated tax hikes and spending cuts are implemented, a pair of Federal Reserve officials warned Tuesday.

Charles Evans of the Chicago Fed described the cliff as a "big uncertainty," while his Atlanta Fed colleague, Dennis Lockhart, said the financial markets could react negatively before year's end if the perception is that Congress and the White House are doing too little to stave off the mandated actions, CNBC.com reported.

The tax hikes and spending cuts are the result of the failure by a congressional "supercommittee" to come to an agreement on measures aimed at reducing the federal budget deficit.

While both men agreed that the U.S. economy, which once again appears to be running out of steam, is disappointing, they differed whether there was a need for continued stimulus.

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