Suspended between childhood and puberty, eighth graders are notoriously ill-behaved and ill-mannered. My teacher that year was Mrs. Woodward, and I wish she was in Washington, where members of Congress are both ill-behaved and ill-mannered. She did not tolerate disrespectful slackards and actually threw kids out of class if they were not working hard or playing well with others.
While it will certainy not be good for the economy, a short shutdown of a week or so will not do much damage to the economy, but why damage such a frail economy at all?
It is surprising to me that the stock market is so sanguine about a potential shutdown. Futures indicate the market will be up 50 points at the open. It obviously believes any shutdown will be short-term. That would change dramatically if the shutdown is not short-term.
If Congress is this dysfunctional over a fraction of 1% of the budget, imagine how hysterical they will be when they begin "debating" the new budget of Paul Ryan, who is Chair of the House Budget Committee and actually deals with the far bigger problem of entitlements. My fading faith in the democratic process comforts me . . . somewhat.
But, my biggest fear is that Congress will not raise the debt ceiling next month. That would be far more important than any government shutdown! While I have already sold almost all my Treasuries, I will sell the rest when I believe the debt limit will not be increased. Not even Miss Woodward could have controlled the amoral, international 24/7 bond market . . . but she may have died trying!
