Government Shutdown/Debt Limit - Issues and Timelines for Investors

[CapitalistOppressor]

House bill is dying. They just don't seem to have the votes. I assume they'll put it on the floor anyways, so that it's failure will allow Boehner to claim there is no choice but to accept the Senate deal.

The question is whether Cruz or his allies will obstruct it, or even filibuster it in the Senate. If they do it'll be this weekend before something passes.

 

[emupilot]

So how bad is this whole drama now, is someone following it closely?

The Senate is ready to pass a debt limit extension and reopen the government, but at the moment the House is still hoping to use impending calamity as leverage. A very negative market action may be needed to convince the House to just accept the Senate's deal and move on.

 

[CapitalistOppressor]

Of course, it's still an open question whether anything that passes the Senate will get through the House. Heritage Action, and the activists on the Republican side are still whipping to hold the line.

- - - Updated - - -

I guess I was wrong. Looks like the House Leadership isn't going to hold the vote.

Robert Costa (robertcostaNRO) on Twitter

Confirmed: tonight's vote is dead

“The votes aren’t there,” says a leadership aide. “We’ve been unable to get people around this strategy.”

What killed it: late afternoon mtgs at Cap w/ conservative members and leadership. Firehose of cold water

House GOP May Cancel Vote | National Review Online

 

[blakegallagher]

Of course, it's still an open question whether anything that passes the Senate will get through the House. Heritage Action, and the activists on the Republican side are still whipping to hold the line.

- - - Updated - - -

I guess I was wrong. Looks like the House Leadership isn't going to hold the vote.

Robert Costa (robertcostaNRO) on Twitter



House GOP May Cancel Vote | National Review Online

a bit of a cross post but is this why futures went positive?

 

[CapitalistOppressor]

a bit of a cross post but is this why futures went positive?

Theoretically, the failure of the House plan is a positive, regardless of whether they choose to vote on it or not. It clears the deck for the Senate to act. However, there is still the worry that Cruz will filibuster, and that once we are past Oct. 17 the House will refuse to take up the Senate bill.

 

[Larken]

Dramatic turn of events, thanks for keeping us non-Americans up to date. Is anyone here considering selling TSLA stock tomorrow in case of a tanking market the rest of the week? I consider myself to be a long TSLA holder and plan to hold for years, but if we have a default then TSLA will go down a lot I suppose, so I'm considering selling the lot and buying it back cheaper hopefully... what about you guys?

 

[Palpatine]

Theoretically, the failure of the House plan is a positive, regardless of whether they choose to vote on it or not. It clears the deck for the Senate to act. However, there is still the worry that Cruz will filibuster, and that once we are past Oct. 17 the House will refuse to take up the Senate bill.

The Senate plan has no chance on arrival in the House. That is the key message here. If the Speaker brings it up for a vote with a plan of 200 Democrats and 18 Republicans passing it, then Boehner might as well resign now.
So Boehner has no choice but to amend the Senate plan and sent it back. That is my prediction for how this plays out.

John Boehner is not going to fall on his sword for Obama and Reid. That much is guaranteed. I don't see him throwing away his political career on this.
He will only move forward if he has 120-130 members of the GOP House behind a plan from the Senate. He won't allow something on the floor with a strategy of 200 Democrats and 18 Republicans.

 

[CapitalistOppressor]

The Senate plan has no chance on arrival in the House. That is the key message here. If the Speaker brings it up for a vote with a plan of 200 Democrats and 18 Republicans passing it, then Boehner might as well resign now.
So Boehner has no choice but to amend the Senate plan and sent it back. That is my prediction for how this plays out.

I don't disagree that Boehner wants to keep his job, and that you'd expect the House to amend a Senate bill and send it back, but the question becomes where do they get the votes to amend it? The House leadership tried all sorts of combinations in today's bill in an attempt to get to a majority, and none of them got them there.

Once we are past the 17th (which seems quite likely to me now), the House is going to be under even more pressure. So far at least, increased pressure has resulted in an increasingly fractured Republican caucus. Will that process reverse itself?

If not, the only available majority in the House probably requires votes from the Democrats, who have been very unified so far and seem to be fairly clear about what is required to get their cooperation. If Boehner doesn't allow that vote, and if he remains unable to muster a majority to resolve the crisis, where does that leave us?

 

[Norse]

The House bill is dead according to CNN.

 

[arashlzy]

I don't disagree that Boehner wants to keep his job, and that you'd expect the House to amend a Senate bill and send it back, but the question becomes where do they get the votes to amend it? The House leadership tried all sorts of combinations in today's bill in an attempt to get to a majority, and none of them got them there.

Once we are past the 17th (which seems quite likely to me now), the House is going to be under even more pressure. So far at least, increased pressure has resulted in an increasingly fractured Republican caucus. Will that process reverse itself?

If not, the only available majority in the House probably requires votes from the Democrats, who have been very unified so far and seem to be fairly clear about what is required to get their cooperation. If Boehner doesn't allow that vote, and if he remains unable to muster a majority to resolve the crisis, where does that leave us?

Boehner has said it twice this past week...he won't allow a default. So I think when it comes down to it, he will just the bite the bullet, pass whatever the dems need to keep things going for a month or two, and we can all be back here at that time:scared:

 

[Kaivball]

If Boehner doesn't allow that vote, and if he remains unable to muster a majority to resolve the crisis, where does that leave us?

A balanced budget and no more deficit spending.

 

[Palpatine]

A balanced budget and no more deficit spending.

+1

That would be a real crisis.

- - - Updated - - -

Boehner has said it twice this past week...he won't allow a default. So I think when it comes down to it, he will just the bite the bullet, pass whatever the dems need to keep things going for a month or two, and we can all be back here at that time:scared:

I think that is what might actually happen. They will just shorten the timelines to keep the pressure on.
Maybe just a 3-6 week debt limit increase and leave the gov't closed.

 

[rcc]

As I understand it, the House can't vote unless Boehner brings it to the floor. Any bill that the Tea Party Representatives will vote for is a bill that neither the Senate nor the President will pass. People don't understand that the hard-core Tea Party doesn't believe in compromise. So the only realistic way anything is passing is for the Senate, House Democrats and some House Republicans to all agree on a compromise. But that can't happen unless Boehner allows it because he's the only one who can bring the bill to the floor.

So it all comes down to this - can the non-Tea-Party House Republicans and the Democrats agree on a compromise? And will Boehner allow a vote on the compromise before the country defaults?

Personally, I don't think he's got the guts to cross the Tea Party until and unless it's clear to the Republican voters in his district that the Tea Party and this whole shutdown thing is insane. And that'll take a default. I suppose he could decide to risk political suicide in the service of his country. Maybe I'm being cynical but my bet is 75% chance of a default. Best odds are 50/50.

 

[Palpatine]

So it all comes down to this - can the non-Tea-Party House Republicans and the Democrats agree on a compromise? And will Boehner allow a vote on the compromise before the country defaults?

Personally, I don't think he's got the guts to cross the Tea Party until and unless it's clear to the Republican voters in his district that the Tea Party and this whole shutdown thing is insane. And that'll take a default. I suppose he could decide to risk political suicide in the service of his country. Maybe I'm being cynical but my bet is 75% chance of a default. Best odds are 50/50.

I think this is all a clear sign that Boehner is running for re-election and wants to be Speaker again for 2015-2016.
If he doesn't win something here during this process, he can kiss his political future goodbye. The conservatives in the GOP House will dump him if he surrenders.

 

[Norse]

Im just gonna say again, when they are so far from eachother, and when some republicans in the Senate thinks breaking the debt ceiling isnt that bad, it makes me worry.

 

[Julian Cox]

Suggestion: Use this externality cock up to get an entry point on Q3. Personally I thought it was a good idea to take profits on the speculation that it will be solved. The strength of the Q3 price movement case will be dramatically more certain than dealing in externalities.

 

[Norse]

Suggestion: Use this externality cock up to get an entry point on Q3. Personally I thought it was a good idea to take profits on the speculation that it will be solved. The strength of the Q3 price movement case will be dramatically more certain than dealing in externalities.

Hopefully. Tomorrow with no news I guess the market probably go down abit. Tho im wondering what news could make the market to really tank. You can never say a deal is off forever.

 

[NigelM]

Does anyone think that a short term deal won't just lead to another 2-3 months of political insanity and therefore market uncertainty?

 

[Julian Cox]

Does anyone think that a short term deal won't just lead to another 2-3 months of political insanity and therefore market uncertainty?

No, as a matter of fact I think (my opinion only from the outside looking in - I am not American) that the result of this nonsense is the certainty of a dem re-election in 2016 and therefore political stability around the advance of EVs.

 

[Norse]

Does anyone think that a short term deal won't just lead to another 2-3 months of political insanity and therefore market uncertainty?

I agree. People are pissed this happen every other year. Noone wants it back in 6 weeks.