Waiting For Progess on Capitol Hill Over The Fiscal Showdown

washOn Monday the U.S dollar fell to a near two month low against the Japanese yen and the Dow dropped over 136 points (-90 percent) in trading as investors became concerned about the lack of progress on Capitol Hill last week-end over the government shutdown and raising the debt-ceiling.

President Obama made an unscheduled public appearance Monday morning at the Federal Emergency Management Agency (FEMA) which is 86 percent furloughed and lacks proper federal funding due to the government shutdown to confront natural disasters.

Obama used the setting to respond to earlier public remarks House Speaker John Boehner (R-Ohio) made over the week-end during ABC’s This Week that suggest he is unwilling to negotiate with Republicans over the budget impasse.

“I have said from the start of the year, that I’m happy to talk to Republicans about anything related to the budget. There’s not a subject that I’m not willing to engage in, work on, negotiate and come up with common sense compromises on” Obama said.

“What I’ve said is that I cannot do that under the threat that if Republicans don’t get 100% of their way, they’re going to either shut down the government or they are going to default on America’s debt” Obama added.

Senate Leader Harry Reid (D-Nev) also responded to House Speaker Boehner’s week-end remarks from the Senate floor on Monday and urged him to hold a new House vote on a clean bill to reopen the government.

“Yesterday the Speaker of the House of Representatives claimed there aren’t enough votes to pass the only bill that can end this dangerous government shutdown. The Speaker is mistaken” Reid said.

“Two hundred Democrats in the House have said they would vote for the bill to reopen the government. And 22 Republicans in the House have said publically that they would vote for the bill as well. Last time I checked, that adds up to a majority of members of the House of Representatives” Reid explained.

Because House Speaker Boehner has not shown any willingness to send a clean bill to the House floor to reopen the government, Senate Democrats are proposing new legislation that will give President Obama the authority to raise the debt ceiling for one year unless two thirds of Congress vote to block it.

Latest poll data from Pew Research Center conducted on Oct. 3-6th among 1,000 adults revealed that by a margin of 38% to 30% Americans believe that Republicans are to blame for the government shutdown instead of the Obama administration while 19% said that both sides are equally to blame.

Only two weeks ago, the poll results showed that 39% of American would blame Republicans instead of the Obama administration 36% if the federal government shuts down.

If the government shutdown continues this week, trade data on Tuesday and retail sales figures on Friday won’t be released to the market, leaving investors with less economic data to react to.

Last Friday, the U.S. Labor Department was unable to release their non-farm payroll number for September due to the shutdown.

The Pentagon reported over the weekend that it would recall most of its 400,000 furloughed workers from the list of 800,000 total federal employees that can’t work because of the government shutdown.

On Sunday Treasury Secretary Jacob Lew called on Congress to raise the $16.7 trillion borrowing limit before the deadline to avoid damage to the government’s credit standing.

 

 

 

 

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