Two Federal Reserve officials warned Tuesday that the U.S. could be heading for a “fiscal cliff” at year’s end if mandated tax increases and spending cuts are implemented.

Charles Evans of the Chicago Fed called the cliff a “big uncertainty” while Atlanta Fed President Dennis Lockhart said there could be a “financial shock” if markets begin to anticipate that Congress and the White House do little to address this situation.

The expected tax increases and spending cuts were triggered when a congressional “super committee” failed to come up with a way of closing the federal budget deficit.

Both Fed officials spoke during the Milken conference in Los Angeles. Earlier Tuesday, on CNBC, both agreed the slowing U.S. economy is disappointing, but differed on the need for continued stimulus.

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