Well, it appears that I have been the target for simply stating the obvious - BE SAFE
I would not be in right now. The market is still fully vested (partly because of the talking heads telling everyone not to worry). If the deal comes through, we rally, but not as much as people think. If any senators even indicate they might hold this up an hour or so, and or it looks as if Boehner is not going to put a Senate agreement to the House floor for a vote without amendments, then you will have wished you could turn back time.
Playing with fire. Someone posted about how I felt about my technical analysis call now. The fact is that the binary situation today takes precedence over any technical or fundamentals based call. It comes down to the cardinal rule of investing and trading - wealth preservation. There are a group of radicals who have even warned the markets that they see no problems taking this out till the end of the month, but despite completely unproductive and irrational behavior until now, the equity market and its participants continue to believe that they will just do the right thing now. The bond market is showing that there is a problem with this faith. Yields on short term T-bills are up from a negative yield just three weeks ago and now trade 50 basis points positive. That is after they had traded with negative yield for over a year.
Attack me all you want, but the smart trade here is to be out until this is definitively settled in Washington.
And if you want to talk about technical, history has shown time and again that when other markets price in risk or price changes that the equity market ignores, it is often the equity market that reprices in a drastic manner to "mark to the market" so to speak. Here we have the bond market - which deals with the primary securities of interest here, the government bonds needed to fund our system and which can not be issued if the debt ceiling is not lifted - which is clearly pricing in a lot more risk of default than the equity market. And for those of you who listen to the media too much, it isn't just about waiting for revenue to come in to augment the 30bn cash on hand to pay interest on the debt as it comes due. That is the whole argument about how with prioritization of payments (a problematic idea because it is completely unworkable) the government can avoid default until well into next week. In reality, if there is no deal and we go to midnight tonight, then anyone who holds the debt can force the country into default by forcing rollover. This is what the government debt market is worried about. Say 100bn is asked out of the debt market because someone is skittish and wants out. The US will not be able to honour this request. This is a very serious risk, and the Tea Party people and others don't seem to understand it.
How do you figure that it is Boehner's and the House's fault BOTH when they passed legislation that would increase the debt ceiling that the Reid and the Senate refused to vote on or voted down, AND when the Senate sends an "Agreement" to the House and Boehner decides to not to put it to a vote?
Sounds very hypocritical to me?
By the way, the ONLY reason Obama was elected to both terms were his promises [lies] to REDUCE the debt, REDUCE government spending, and provide Affordable Health Care that would SAVE money for both the insured and the government. This is not an opinion - it is FACT! You can verify it by checking the pole data on what voters "believed" the Obama Administration was going to do.
Even Harry Reid and Obama have spoken out vehemently against raising the debt ceiling and how it would have a serious negative impact on our economy and he lives of our children (again, look it up - their speeches are widely available on YouTube and other sources).
The Tea Party is the ONLY segment of any political party that is trying to do what is right AND what the majority of American Citizens want. Even Republicans are guilty of increasing the size and expense of government. This may come as a surprise to you, but the salvation of the capital markets should NOT be the primary concern of our government.
At some point our excessive government spending HAS to STOP! What you are supporting is yet another turn in a very long line of kicking the can down the road. The Obama Administration has LIED to the American Citizens - debt is UP, spending is out of control, and the Affordable Care Act is proving to be the single most disastrous piece of legislation in the history of our government.
Yes, a default would have a huge negative impact on the economy. But, in the long run, the economy and our government's actions will have ZERO affect on Synta. There were many great companies built DURING the great depression.