Kudos to the Republican Party for standing by their principles. It's too bad for us that their principles are INSANE and destructive to the American way of life – but at least they have conviciton. In fact, some of them and many of their donors have already been convicted – with luck, more will follow (we're looking at you, Jamie!).
Shutting down the Government is not an instant thing, it comes in various stages but Stage 1 already sucks for 800,000 Federal Workers that have been immediately furloghed without pay. One might wonder what kind of monsters would take the paychecks away from 800,000 innocent people whose jobs are to HELP millions of other people get through their day but I'm not going to point any fingers – you can draw your own conclusions.
Ironically, the Affordable Care Act, the ones the Republican'ts are trying to shut down, WON'T be shut down because it's already fully funded. Again, someone is an idiot – but I won't point fingers… The IRS has to cancel all audits, another victory for the tax-cheating constituency and, in one of the stupidest cuts of all, Members of Congress will begin losing staff – at the same time as they're supposed to be working on a solution to the funding issue! The National Weather Service is shut down, so there may be a hurricane comming – we just don't know. We also don't know anything about the economy, as all statistics are on hold – including Friday's critical Payroll Report!
On the left is the schedule of major bills (in Billions) that must be paid over the next month and, officially, we only have enough money to get us to the 15th before we run out. The 15th is key because we hold debt auctions that week on 3-year, 10-year and 30-year notes and Any uncertainty in the ability to settle the entire auction without breaching the debt limit would require one of three choices:
- delaying the auctions and issuing cash management bills instead,
- scaling down the auction sizes to only roll over maturing issues,
- or auctioning the full amount and scaling down the regular bill sizes ahead of time to create enough headroom
This is the path we're now on and, as I said to our Members in this morning's Alert, the markets are, so far, shrugging it off in the stage of the market cycle known as DENIAL:
We're already shorting the Futures this morning at 1,075 on the Russell (/TF) and $102.50 on oil (/CL) and, if you don't know why, then you weren't reading what I was just saying. This is serious stuff folks, it's not a joke – which is what they scychophantic media morons are trying to paint it as as their Republican Masters have pushed the Doomsday button and now they have to cover up the mess they've made before the voting (and investing) public wises up.
In fact, if you are one of my Conservative readers, you've probably been reading this whole post thinking I'm just on one of my Liberal rants and making a big deal out of nothing and that's because you've been hearing (from your usual media outlets) that this is not a big deal. Well it is – it's a huge F'ing deal! This is our elected "leaders" fighting like children who don't get their way because a law was passed that they don't like (which occasionally happens in DEMOCRACIES) so they are having a temper tantrum to make sure everyone is as miserable as they are until they either get their way or finally get punished.
When the GOP shut down the Government in November of 1995, they were severely punished a year later when the Democrats took back the Senate, which they then held for the next 10 years (along with the House, which they had held since 1948). The GOP took back the Senate and the House in 1996, Bush was elected in 2000 and our economy collapsed in 2008. The GOP took the House back in 2010 and here we go again!
That's American history 101 – I hope we survive long enough for 102…