Wall Street depressed but Obama hopeful after Republican plan fails

<p>Wall Street is depressed in trading today, but Barack Obama remains hopeful he will strike a fiscal cliff deal.</p>

President Barack Obama is hopeful that a solution to the fiscal cliff will be found expediently after a tax bill proposed by the House of Representatives Speaker was shunned by the Republican Party last night (December 20th).

The White House said it would be working alongside Congress to strike a bipartisan deal ahead of the January 1st deadline, when $600 billion (£369.8 billion) in tax hikes and government spending cuts will come into force.

Last week, Mr Obama warned that if the world's largest economy feels the full force of the fiscal cliff, middle-class families will be lumbered with an extra $2,200 to pay in 2013 – money the already-straitened American people simply do not have.

After John Boehner's tax proposal was rejected, the president is now looking for his own Plan B, but concerns remain that the Democrat leader will struggle to get a bill passed both the Senate and the House.

At 16:40 GMT, the Dow Jones retreated by 1.1 per cent to an index value of 13163.7 points and the Nasdaq slipped by 1.2 per cent to 3012.3 points.

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