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Will the Federal Debt Bomb Go Off?

July 5, 2011 News

Well here we are less than 30 days before our federal debt bomb goes off.  If our politicians don”t get the debt limit extended before 8/2, there will be a “Grand Finale” that day which will make yesterdays display pale in comparison.  It is inconceivable to this writer that our representatives are being this irresponsible regarding their fiducuary to the people of this great country. 

Do I believe they will get things done before 8/2?     Yes     However, the agreement will be an 11th hour event as brinkmanship overules responsible behavior and they wait until the very last moment to cut their sweetheart deals.  Volatility will be in vogue for the interest rate and stock markets.  For those of you floating your rate on a sales contract, I would suggest you lock it in soon.  That dog won’t hunt as time clicks off closer to 8/2 and rates will probably move against you.

Be careful out there as volatility, uncertainty and politicians are the mortal enemies of markets.  Choose well and stay well.

-Paul