DEBT CEILING & ITS DEBATE.
The spate of catastrophes leading to the nosedive of the markets on Wall Street on Thursday, were plain to visualize; yet market gurus mentioned everything on earth that could cause them, including a slow economy in the United States, the job market and the subsequent report on the unemployment level that was expected on Friday (today), the economic setbacks in Spain and Italy that have suddenly railed against the activities in world markets, and so on; but the Debt Ceiling crisis that has just gone by was completely left out.
The Dow Jones average fell in eight straight days until Wednesday, August 3th, 2011, after the debt limit bill had passed through both chambers of the U.S. Congress. It recovered on the ninth day, which would have been a new record in its trend of going down, whenever the markets were upset by an external event of some sorts; however, that was somehow avoided.
Then, on Thursday, August 4th, as if from out of the blue, the Dow started a free fall that would make it to lose over 500 points in one single day. Traders have panicked and have begun to dump all kinds of stocks to relieve the heavy burden the uncertainty of the debt ceiling debate has placed on them in recent months.
They (traders) would have handled that risk in a discreet way, as they have done in previous years, but for the additional economic bad news that sprung out of no where from Europe to cause trading to get out of hand.
However, would it not be a wonder that none of the experts that crowded the media to analyze the kinds of things, that have usually generated an upheaval of the type that was seen yesterday, to make the markets to become so volatile, never imagined that the strenuous debt ceiling debacle, brought about by the Republican Party entourage in Congress, had contributed to what had happened in the marketplace?
Although, they knew perfectly well that both consumer and investor confidence have waned considerably, during the time that the whole world was waiting to see if the U.S. would default in making its bill payments. Such being the case, there was a standstill atmosphere around globe
In that, some members of Congress have wasted so much energy in turning what a normal process of raising the so called debt ceiling into a national argument, which was rather unnecessary; and the rest of the world was caught in holding its breath and to wait. It finally concluded as a non-event, with respect to its outcome.
A bill was signed into law by President Barack Obama to lift the debt ceiling and bring the crisis to an end.
Yet, the damage has already been done to undermine the American economy by those who professed to formulate policies that would stop the government from overspending, for they have been mandated to do so by the electorate in the fall of 2010; but their ulterior motive was promoted, and certainly promulgated by sheer jealousy for the Obama administration.
Their actions have triggered off the instability that would follow and send jitters through the markets; however, investor confidence would return to make up for the loss on Thursday; thus the markets have to bounce back for the sake of the nation.
Its (nation's) determination for a stronger economy would prevail in the long run, despite what some politicians have deliberately done to disrupt the pace of progress it (economy) should be making. Its present fragile condition would surely improve. What they did was to prevent it from moving forward faster than it was expected. Gauche.