October 13, 2013
– Comments (5)
Many analysts say that the debt limit must be increased or market will drop. In the 2 1/2 month period following the last raising of the debt limit the market actually dropped by over 6%.
Except in 2011 the market dropped nearly 19%.
What happened the last time Congress refused to increase the debt limit when it was time to?
Oh right, that never happened before because everyone knew it would be apocalyptic.
If by default we are expected to raise the debt limit each and every time, why do we even go through this mindless charade. Just give all presidents the platinum mount blanc pen along with the check book and let them fill in the numbers. It probably would be a complete violation of all rationale to consider reducing gov spending....
The reason the market dropped in 2011 was because of the situation in Europe, not because of the debt limit. The reason the market is doing well so far this year is the sequester.
Sorry Mathman I was there watching my portfolio tank as Congress played brinksmanship with the ceiling. S&P lowering the US credit rating had absolutely nothing to do with Greece and a lot to do with the drop.
While I do like the sequester, that has little to do with why the market has done well this year. Corporate profits have been the main reason although there might be a slowing down and could decline depending on how long this shut down lasts.