An article last Friday says that the tax hikes and spending cuts that will result after December 31 if Congress does not take action to avert those scheduled changes (broadly referred to as the 'fiscal cliff') have already in 2012 resulted in one million U.S. jobs being lost - and will result in loss of a further 6 million jobs through 2014 and a reported U.S. unemployment rate of 12%.

I don't know whether the data set out in the article has any validity, but even if directionally correct it emphasizes the importance of the election results on November 6. Anyone with money in the financial markets ought to be glued to their television sets that evening as the election results are reported. Simply put:

• irrespective of your political leanings, if the November 6 election results do not result in control of the House, the Senate, and the Office of the President by (alphabetically) either the Democrats or Republicans there is a high probability that the polarization that has gripped Washington for the past two years will not face significant melt-down. This voting result seems highly unlikely;

• if saner heads do not prevail, and there is no change in Washington polarization in period after November 6 America, which in economic terms currently is between a very hard rock and a very hard place, is almost certain to find that rock and hard place in fact to be a vice - in circumstances where that vice will continuously tighten going forward.

Whether you agree with my assessment of this or not, I suggest you think hard about it, and do so in a very apolitical way. Whatever your conclusion then is, review your trading and investment positions in the context of that conclusion.

You might want to read 'Fiscal cliff' warnings rise to (overblown?) fever pitch. That article, which includes reference to job losses and dire predictions, states expectations in keeping with my comment about 'saner heads prevailing' that almost certainly will happen. In other words, a balanced expectation is that the potential severity of fiscal cliff consequences will thaw any Washington polarization at least to enable the 'fiscal cliff' issues to be dealt with on a timely basis.

That said, recall the July/August 2011 U.S. debt ceiling impasse. The required 'fiscal cliff' negotiations may in the end be similarly conducted. Also recall that S&P downgraded U.S. debt concurrent with those 3011 debt-ceiling negotiations.

Topical Reference: One Million Jobs Already Lost Due to Fiscal Cliff, from The Fiscal Times, Lori Montgomery, October 26, 2012 - reading time 4 minutes. Also read 'Fiscal cliff' warnings rise to (overblown?) fever pitch, from Economy Watch NBCNews.com, John W. Schoen, October 26, 2012 - reading time 2 minutes.