By Mary Anne and Pamela Aden and the Dow Theory Team
Here is where we come to the difficult part of the picture...
The US is in a position where any recession would be disastrous. Any severe recession would drop the government's tax take drastically, and if that happened the budget deficit would soar off into space.
At the same time, if we experience a recession the pressure will be on for the government to spend more, not less. And raising taxes during a recession is well-nigh impossible.