House, Boehner Cave To Reid And Obamacare On Debt Ceiling: Delay Obamacare For 1 Year

Confounded Interest ^ | 09/29/2013 | Anthony B. Sanders

[whitedog57]

The House passed a continuing resolution without Obamacare funding, the Senate put Obamacare back in the continuing resolution, and now the ball in the House’s court with only days to go …. to government shutdown!

The Republican-led U.S. House voted to attach a one-year delay of Obamacare to a must-pass spending bill, dramatically raising the likelihood of a partial government shutdown Oct. 1.

So, it appears that Senate Democrats will shut down the Federal government, at least for a few days, if they don’t go along with Boehner’s demands of … delaying Obamacare for 1 year and getting rid of the medical device tax.

Zero Hedge has a nice summary of the negatives associated with a government shutdown. Suffice it to say, it is all about the crippling Obamacare legislation.

Regardless of the government shutdown or not, labor force participation rate will continue to fall along with M2 Money Velocity.

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But what about a default since? the government could miss interest payments on Treasuries, triggering a first-ever default by the U.S. government. U.S. Treasuries are held by banks, governments and individuals worldwide. Ultimately, a prolonged default could lead to a global financial crisis.

But what do financial markets think? 5 year credit default swaps (CDS) for the US are still very low, about the same as Switzerland.

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But US 5 year CDS prices have risen in the last two weeks from 24 to 32.

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The VIX (the Chicago Board Options Exchange Volatility Index that reflects a market estimate of future volatility) rose slightly on Friday.

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The US Treasury 10 year yield fell almost 7 basis points on Friday, but rallied at the end of the day. So not much going on there (down 2.5 basis points on Friday).

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And gold prices are not reflecting any risk of government default either.

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So, the market is pricing in a low probability of default for the US. But with $17 trillion in Federal Debt and $70 trillion in off-balance sheet liabilities, …

But fear not. If you are a taxpayer, your share of unfunded liabilities is $1.1 million EACH. And if you don’t pay Federal taxes like 43% of Americans, you also get an Obamacare subsidy for healthcare.

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I will check the market reaction on Monday. It could be an exciting day.

[Political Junkie Too]

It's a cave in the sense that it defers Obamacare until after the 2014 elections, taking a valuable campaign card off of the table.

It's also a cave in the sense that Boehner could have taken the tactic of sending separate department-level funding bills to the Senate, and making Reid explain why the Senate would only accept a CR funding the whole government when the Sentate won't pass a clean annual budget bill that does the same.

-PJ

[Lancey Howard]

The Republicans are colluding with the Democrats to “delay” Obamacare until January 2015 and give the Obama regime a chance to smooth out the wrinkles so it “works right” and keep the issue from hurting the rats too much in the 2014 campaign.

In return for giving the rats another year-plus to deepen the roots of their communist healthcare, the Republicans will cave on the debt ceiling. What a deal.

Wow, are we ever being played.

[marygam]

It is something. Boehner did something for a change and the house is united. I agree the issue is the Senate. What Cruz has done is allowed America to hear over the course of 21 hours what a true POS law the democrates shoved down our throats. Now ball is in their court. Lets see if they can get more than 19 Republicans and a couple scared Democrates to unite.
Interesting times we live in.

[Protect the Bill of Rights]

There is a group of GOP reps on the steps of the Capitol in front of the closed Senate doors. Fox covered it for maybe 5 minutes, then cut away because they were all saying essentially the same thing. :(

They were calling Reid out on not convening the Senate today. I suspect they were also doing it to put the pressure on no-Boner.

After they cut away Jarrett and his pundits said it amounted to nothing except maybe make the dems share “some” of the blame. However they still all most of the blame would go to the GOP.

[BfloGuy]

Boehner caves as expected. What a RINO loser.

There's been plenty to criticize Boehner over. This isn't one of them. You're just being impossible for the fun of it.

[Uncle Chip]

If Obamacare can be delayed a year, then later it can be delayed another year, and then another everytime Obama keeps coming back for more money, and then maybe indefinitely.

So let’s take what we can get right now.