Here is what happened the last debt crises… published from the Treasury’s blog

“The financial market stress that developed in
August of 2011 persisted into 2012 even
though Congress raised the debt ceiling prior
to the exhaustion of extraordinary measures.”

“From June to August 2011, consumer
confidence fell 22 percent and business
confidence fell 3 percent.”

“Financial market conditions have a direct
effect on economic activity. A good deal of
household wealth is held in financial assets,
and much of household and business
spending is funded by borrowing. Thus,
lower asset prices and higher borrowing costs
tend to weigh on private spending ”

Now the clicker….

“So far this year, Treasury yields have
been rising on balance, which means that any
adverse effects from financial market
disruptions caused by a debt ceiling debate
may not be offset as it was in 2011.

That is why it is unlikely that Boehner will send us over the edge. In fact, the sooner he sells out the Tea Party, the better…

The last 5 days of stocks…
-70 -128 +68 -58 -120

Do you feel poorer already? Better cut back on that spending…..

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