Panel: Fiscal Cliff's Economic Impact

ABC News' Bianna Golodryga and Leigh Gallagher of Fortune Magazine.
5:11 | 12/30/12

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Transcript for Panel: Fiscal Cliff's Economic Impact
Thank you both for joining us. Bianna, let me start with you. What happens on wall street the day after a deal goes down? If they don't actually make a deal. Well, look, jon, I don't have a crystal ball in front of me but we saw a 2% decline in the dow last week. If we don't have a deal, I think we'll continue to see a drop. I don't think it will be as huge of a drop and unfortunately to press washington's hands the way we saw in 2011 last summer and before t.A.R.P. Was passed but ultimately when we get some sort of mini deal we will see a rally back up but again this only buys us a few weeks because as your panel noted we have the debt ceiling coming up in february. I mean the counters, will wall street reward this mini deal, or will it be seen as this really doesn't do anything? I think we may have a couple days' bounce, the market rallying back up a percentage point or two, but I think ultimately the eye is going to be in what happens in february when that debt ceiling comes up. And, leigh, have the markets really fully taken in the possibility that this may not happen? I get the sense that people assume, oh, they'll do this at the end, you know, deadline as it always happens but I mean does the market see a failure, complete failure as a possibility here? You know, not quite yet. Even though we saw this 158-point drop that bianna mentioned on friday and even though markets have been pretty unsteady actually ever since plan b failed in the house, that was really kind of the turning point where we started to see this shakiness, for the most part stocks had been building in the fact that there probably would be a deal, so things have changed in just the past week and I do think we'll see some major impact on wednesday if there is no deal because the market hasn't fully appreciated that yet. They don't kind of understand why this is happening, as most of the rest of us don't. But, leigh, don't you think the writing has sort of been on the wall the past few weeks. Up until last week the dow was positive for the month and now all of a sudden we've seen a five-day decline. Consumer confidence fell as jon mentioned at the top of the show for the second time in two months, so people are starting to sense the impact and CEOs, AS WELL. They are and I think that's why if there is a last-minute deal we will see a rebound in the market and that will be PRETTY STRONG BUT CEOs HAVE BEEN Worried about this for months, if not years, I mean, this has been -- that's why we've seen who of the fortune 500 has been traveling down to washington in batches since july, august, you know, they don't want this to happen. This is -- they don't know what this means for spending cuts, for tax cuts, this means they don't know what's going to happen to the economy and what's going to happen to the market and that means they can't plan and these companies build in their budgets for 2013 in june and july, so in many ways, this is going to be baked into the spending we see in 2013 already. And, bianna, you spoke just recently with the oracle of omaha, right? You spoke to warren buffet. What's his take on all of this? Yeah, I asked him for his take. Ever the optimist long term with regards to the u.S. Economy. He gave us a statement as well. He said "the american economy has worked well since 1776, albeit with periodic and sometimes severe interruptions, and will continue to do so. Berkshire will invest a record amount again in 2013 in plant and equipment. What's right with america far outshadows what's wrong with washington." Now, some could argue if we do get past this fiscal cliff and address the debt ceiling, 2013 could actually be a good year for the economy. The housing market continues to recover. We do see an energy boom, as well, but, you know, I spoke with former treasury secretary robert rubin, as well and i think he summed it up by saying this really was a missed opportunity that we're seeing right here for some sort of grand bargain for a big deal to address the debt limit here and so far we haven't been doing that. And, bianna, I would not count on these guys finally getting their act together in any significant way even if we get a mini deal. Thank you so much to both of you. Bianna and leigh, thank you for joining us here on "this week." Finally your voice this week. Today's question comes from christy miller jones from facebook who says "my 16-year-old has a twitter account with 34,000 plus followers. Where do you see journalism heading in 15 years? What advice to the next generation of journalists would you give?" Well, thank you for that question, christy. I would say regardless of what form americans will get their news in the next 15 or 20 years my advice to the next generation of journalists is to remember the basics, know your history, try to get your facts straight, always strive to be fair and don't be afraid to admit when you've made a mistake. As for your 16-year-old's 30,000 twitter followers, can I get a retweet? You can follow me all week long online @jonkarl, and I'll answer some of your questions after the show. Thank you for sharing part of your sunday with us. Thank you. Check out "world news" with david muir tonight. George will be back to start 2013 with a big bang sunday right here on "this week."

This transcript has been automatically generated and may not be 100% accurate.

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