Not surprisingly, Wall Street looks a little wobbly at the opening bell this morning. This follows a previous negative session buoyed only partially by the Federal Reserve’s latest helicopter drop of printing press cash. The reason for the continued negativity should be fairly obvious by now. Stock futures are falling as the partial shutdown of the U.S. government drags on for a third day.
The government shutdown, originally estimated to last a day or two by most analysts and pundits, looks to be more lengthy now, perhaps considerably so, as the main aim of President Obama and the Senate Democrats seems to be the destruction of the Republican party, regardless of the economic and social consequences. While the shutdown itself is estimated to trim only about 0.2 percent from the gross domestic product each week, that could grow worse if the impasse begins to erode consumer and business confidence.
That was essentially the message from the National Retail Federation, which releases its sales forecast for the next two months on Thursday. Matthew Shay, the group’s president and CEO, said the calculations were made before the shutdown.
The President himself, as has been his custom over the past five years, won’t condescend to dirty his political hands over the budget mess that both he and Senate Majority Leader Harry Reid have kept at a boil by refusing to pass a real budget as Congress is required to. Budgets – and of course, budget ceilings – exist for them only as theoretical limits on the U.S. Treasury’s printing presses as well as convenient opportunities to unite with the lapdog media in attacking Republicans for the problems the Democrats themselves have caused and refuse to remedy.
Obama kept the pot at a boil yesterday, making deliberately provocative comments to the press based on lies, evasions, and half-truths, as is his custom.
In a CNBC interview, Obama said, “When you have a situation in which a faction is willing to default on U.S. obligations, then we are in trouble.” That “faction,” of course, is the Tea Party whose position has never included a “willingness” to default. They simply want to slow the increase in the debt ceiling by trading current increases for further tax cuts.
“I am exasperated with the idea that unless I say that 20 million people, ‘you can’t have health insurance, they will not reopen the government,’” Obama continued. “That is irresponsible.” This, of course, is another astonishingly transparent lie. No one on Capitol Hill in either party as ever said that Americans “can’t have health insurance.” The Republican opposition is simply stating the obvious, namely that the reckless, out-of-control Affordable Care Act, more un-popularly known as Obamacare, is not the way to go about it.
No matter. Obama continued to bore in on this phony scenario on CNBC and elsewhere Wednesday. “If we get into the habit where one party is allowed to extort, …then any president who comes after me we be unable to govern effectively,” Obama said. Seriously?
Commenting on the entire current impasse, he recklessly observed, “this time I think Wall Street should be concerned.” Surely even this president must be aware that responsible high government officials must never shout “Fire!” in a crowded theater. Or in a life-and-death market of stocks and bonds on Wall Street which, while wobbling lately, is still the financial capital of the world.
But none of this matters to the first American president who longs for the dictatorial powers possessed by his counterpart in the once and future Soviet Union. The prime obstacle to the happiness of this obstinate, childish president is the existence of an opposition party in this country. All other hopes and goals are in the end irrelevant.
The complete and utter destruction of the Republican Party is the only game in town as it has been for nearly five years, despite this president’s constant claim “I have tried to work with the Republicans.” That, in fact, is the biggest lie of all.
All of which leaves the stock market trading on political rumors and news, not on facts, figures, and values. Aside from nimble trading here and there, investing in the old-fashioned sense is just too dangerous right now.
Compounding the problem is the fact that even that old standby, that old “store of value” known as gold has been trading strangely for well over a year now, clearly the subject of some kind of massive, coordinated, and likely illegal maneuvering that regulatory institutions seem uninterested in resolving.
This leaves almost nowhere for concerned investors to go, save for the generous 0.01 percent interest they’re earning on their money market accounts, even as regulators quietly plan to destroy this hiding place as well by forcing the traditional $1 peg to float, thus terminating the usefulness of this vehicle as a holding mechanism.
No trading hints or recommendations this morning. It’s just too iffy, and it’s likely to remain that way as the Democrats and their President refuse to negotiate with the Republicans while blaming the Republicans for refusing to negotiate.
Politics hasn’t been this disgusting in Washington since the waning days of the Buchanan Administration. As the President dithered and failed to lead, Congress disintegrated, and half its members trotted off to found another country. Times are different now, but perhaps we’re watching a very different kind of instant replay.