Absolutely spot-on debt ceiling commentary from Art Cashin:
Statesmen Start To Simulate Three Stooges – The goings-on in Washington are becoming a global embarrassment to its citizens.
Under the guise of working for the good of the people, both sides are engaged in barely-disguised exercises in venal politics.
The primary purpose of the posturing is to structure the “proposal” in a way that will enable the “winner” to be able to blame the other for “hiking the ceiling” or “hobbling Medicare” as a slogan in the 2012 election. All the rest is PR rhetoric.
The markets may understand that. That’s why they are trimming sails rather than all out selling. The key risk is that either (or both) overplay their hand and the gun goes off accidentally. That’s how World War I began, with each side sure the other guy would blink before fighting actually erupted. (See Barbara Tuchman’s marvellous “The Guns of August”.)
Watching the farce in our nation’s capital, I am hopefully reminded of the perception of this quote from Winston Churchill:
You can always trust the Americans. In the end they will do the right thing, after they have eliminated all the other possibilities.
Let’s pray that will be true.
Consensus – Kabuki in Washington may trump data. Watch the news tickers and stay very nimble.