There seems to be more optimism that a deal can be reached before end year on the back of Obama-Boehner direct talks.  But views of what constitutes “success” vary widely, and notably how DC and NY look at the question seems quite a bit different.

In sum:

• Market expectations seem centered around outcomes that kick-the-can through 2013 and produce modest deficit reduction; a full cliff dive or a true grand bargain are seen as unlikely and if either were to occur would lead to a substantial Read more »