ANALYST: This Is The Tea Party's 'Alamo' -- The Odds Of Default Are 20%

The consensus Wall Street view remains that, much like in 2011, the debt ceiling will get raised at the last minute.

Surely politicians aren’t dense enough to martyr the U.S. economy for political ends, the thought goes. And even though market analysts agree that a true default would be catastrophic, markets have been relatively complacent to the threat.

But what Wall Street fails to realise, according to Potomac Research Group’s Greg Valliere, is the extent to which the Tea Party just doesn’t care. Valliere wrote to clients this morning:

We talked to Tea Party stalwarts last night, and tried to make our best arguments. “Don’t you realise the Republicans could lose the House in 2014?” We don’t care, they said. “Don’t you worry about a catastrophic reaction in the financial markets?” We don’t care, they said. “Don’t you worry that the Democrats will aggressively play the Social Security card with seniors?” We don’t care, they said.

“This is the Alamo, it’s Braveheart, battles to the death. These people are on a Mission from God,” Valliere says. Still, he puts the odds of a default at 20% (up from his previous estimate of 10%).

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