Following the news that the USA had narrowly missed falling off the fiscal cliff, Steve Davies appeared on BBC Radio 5 to discuss the stock market’s consequent resurgence.
Steve Davies was not too optimistic and said that the problem for the markets is that they are not facing up to the problems they have. The fiscal crisis in the United States has not really been addressed at all and until there are supply-side reforms to boost growth, the longer term prospects are not good, Dr Davies argued.
The market bounce that followed the deal brokered in Congress is a short term rise borne out of relief, Steve Davies said.
Listen to the full interview here. Segment starts at 44.30.