"The overall impact of fiscal policy (combining all levels of government) is likely to go from an average of +1.3 percentage points between early 2009 and early 2010 to -1.7 percentage points in 2011, a swing of about -3 percentage points. We estimate that the boost to the level of GDP starts to decline in mid-2010, first gently and then more forcefully, setting up a significant negative impact on GDP growth in late 2010 and 2011." Jan Harzius, Chief Economist, Goldman Sachs
Note that Hatzius is predicting not merely a drop in GDP, but a
negative effect for 2011. All that debt is beginning to be a real drag -- literally!
