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Obama, GOP Crush Stocks on Path to Fiscal Cliff Showdown

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In a second Senate floor address Thursday, Reid replied to McConnell, saying he would be willing to act on a "reasonable" proposal offered by House or Senate Republicans.

Still, across the aisle, some Republicans maintained skepticism of a deal on Thursday. Sen. Bob Corker (R., Tenn.) said on Thursday that President Obama's meeting today with top GOP leaders was likely little more than window dressing.

"It's feeling very much like an optical meeting, not a substantive meeting," Corker said in a meeting with reporters Thursday.

The presence of Kerry and Geithner at Friday's meeting between President Obama, and Democratic and Republican congressional leadership underscore the wide-reaching impact of the fiscal cliff.

Geithner said on Wednesday he will do all he can to create a cushion for lawmakers. He said in a letter to Reid that the federal government will reach its $16.394 trillion statutory debt limit on Dec. 31.

Geithner said the Treasury is planning "extraordinary measures" to postpone defaulting on $200 billion in bond payments and create some "headroom" for Washington beyond New Year's Day.

If lawmakers don't reach a cliff agreement, the Congressional Budget Office estimates a mix of tax increases and spending cuts will reduce the government's budget deficit by roughly $500 billion a year, a move that could put the U.S. economy in recession next year and cause unemployment to surge to 9%.

For more on the fiscal cliff, see why a housing recovery could blunt a partisan standoff . Also see why bank stocks fell on Thursday .

-- Written by Antoine Gara in New York