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 ...
Yes. The Tooth Fairy only takes baby teeth that come out naturally.
Oh, Oh. Uh I didn’t know that. I’ll have to try a different tack.
From your post, though, I glean you believe in the Tooth Fairy, too?
“Frankly, a bit of panic would be very helpful right now,”
Oh Oh! Continuing high unemployment and feeble economic growth are killing Obama’s performance ratings. Looks to me like the Democrats would like a crisis that they could use to put the blame on Republican “intransigence”. If a panic (like a market crash) doesn’t come, the Dems might engineer one.
Of course! When I was younger I got a dime. My boys got a quarter...inflation doncha know.
Occam’s Razor would say politics doesn’t understand the market.
That is probably because these politics
(obamadministration) DON’T BELIEVE in the
market.
Washington, as with this White House, is a flat out joke. The regulations established in the past 2.5 years under this idiot-ridden administration are making it more of a joke. =.=
The high on the Dow, BTW, in 2007, was more like 14,600. It's currently something like 12,000.
Contrary to popular opinion, however, Wall Street brokerages and banks have more connections to the Democrats and contributed more to their campaigns in 2008 than they did to Republicans. In exchange, they got quite a number of senior appointments to the Obama Administration.
In the current debt debate, they have a vested interest in raising the debt ceiling so that they can buy and sell more Treasury bonds, regardless of their ratings. So they play along with the Democrat and media scare tactics.
Correct on all counts.
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