"..high interest rates would put great strain on both the Treasury and the Fed."

I believe that ALL THREE of us are in agreement on that one.. the question is DOES CONGRESS as well as THE ADMINISTRATION GET IT?!?

I believe that is WHY you are hearing Bernanke say.. "Congress and the Administration MUST WORK TOGETHER to solve the Fiscal Cliff.."

http://www.forbes.com/sites/afontevecchia/2012/11/20/fed-chairman-bernanke-warns-washington-fix-the-fiscal-cliff-or-face-recession/

IF allowed to go forward as is.. the Fiscal Cliff would be Contractionary..  They don't have to solve it ALL.. they can push some of it forward.. in fact will probably have to push some of it forward.. but They ALSO MUST MAKE REAL SUBSTANTIVE PROGRESS on addressing the issues..

.. the markets simply will not stand for anything less than REAL PROGRESS.  And EVERYONE knows it.