Posted on 07/30/2011 9:30:38 AM PDT by Eyes Unclouded
I just got off the phone with a source on Capitol Hill who has spent the past few days trying to convince Republicans to vote for a debt ceiling hike.
He told me that the biggest obstacle he faces has been "market complacency."
"Frankly, a bit of panic would be very helpful right now," he said.
As he explained it, lots of people in Washington, D.C. expected that this would be a week marked by panic in the markets. Stocks would tank. Bonds would get clobbered. The dollar would do something dramatic. And all of this would help convince reluctant lawmakers that they had to reach a compromise on the debt ceiling.
"We were following the script from 2008. When the market collapsed after TARP failed, that spooked everyone enough to get them to fall in line. We thought the same thing would happen this week," he said.
Instead, the market has just been on a quiet, non-panicked slide.
Stocks have sold off by a couple of percentage points, but nothing that indicates a real fear trade in the works.
Everyone in D.C. has a theory about this. Some believe the market is sending a message that a deal will get done. Others think the market doesn't understand politics.
"Every day we wake up and think that stocks will send a shock up to Capitol Hill. And every day nothing happens," the source said.
He's still holding out hope for a panic sell-off at the end of the day.
"It's the only thing that's going to bring everyone together on this," he said.
(Excerpt) Read more at cnbc.com ...
Rick Perry downplays default fears, calling debate ‘political theater’
Looks like the markets are calling Obambi’s bluff...
Bonehead thinks Obama is so cool, you know, like the cool high school kid who never gets in trouble because his daddy is a cop or his mommy is super rich, bailing him out of jail all the time.
Like the cynical poster says: “drugs, because cool kids do them”.
Bonehead has joined the groupie clan like a regular ho.
Not even that. The market is sending a message, and the message is:
“Whatever”.
Occam's Razor would say politics doesn't understand the market.
>>Wall Street is waiting until November 2012.
If Obama gets re-elected, THEN you will see panic.<<
I’m sure there’s more truth to that than we know.
>>I think a credit downgrade is already baked in the cake.<<
I think they’ll wait until we miss a payment.
“We can look at the prices of put options on government bond ETFs to see whether the put options are expensive, which would suggest that the options market is suggesting a substantial risk of a sell-off in government bonds and rising yields... the options prices do not suggest that the demand for ‘insurance’ against a big sell-off in government bonds is high at all. “
http://www.businessinsider.com/government-default-the-market-vs-the-media-2011-7
“What does a downgrade really mean? Treasury debt will still be the highest-quality, most liquid market in the world debt,” said Robert Williams, director of research at Sage Advisory Services in Austin, Texas. “We don’t think it has a major impact on rates, even if there is a downgrade.”
http://blogs.investors.com/capitalhill/index.php/home/35-politicsinvesting/2707-treasury-etfs-fly-despite-likely-us-debt-downgrade?src=HPLNews
They’ve got theirs why would they want to ruin it by tanking the supposed market.
I’ve decided this last-minuteness was designed on the part of the House GOP leadership to put pressure on its tea party reps and as a cover for its predictable total sellout to the Dems. Complete with having Harry Reid’s aides write Boehner’s bill, meant to hook just enough House Republicans to give Reid the chance to substitute Obama’s desired bill, which already was half written into McConnell’s plan, for him.
That’s the problem with that effed up town. They are ‘gaming’ when they should be governing with the interests of tax-paying Americans in mind.
Unfortunately ,it looks like Demint may cave.
Email and tweet him...that Reid Mcconnell compromise is going to be bad
“Frankly, a bit of panic would be very helpful right now,” he said.
Smoke and mirrors with a dash of politics. They said they are going from the 2008 handbook. Sounds like even Wall Street can believe anything said in Washington. When Washington lies as much as they do, no one will believe them even if they someday tell a truth! How sad is that?
I recall a recent headline both here and on Drudge saying Obama already told the key banks that the U.S. will NOT default. With that news already outed despite the doomsday rhetoric, why should the markets panic?
They should be thrown in jail for manipulation of the markets.
The market is being partisan. Let’s regulate it some more to make it panic on cue. Maybe push a stock broker out a window and say it was suicide?
COLLAPSE THE SYSTEM! None dare call it REASON!
Wall Street knows the liberals will shower them with our money.
They’re just waiting for the windfall.
I wouldn’t be panicking if I were a Wall Street Banker either.
It's the financial equivalent of Year 2K.
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