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The Markets Control The Government...Just Watch

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July 27, 2011 – Comments (0) | RELATED TICKERS: AMZN , CVX , SPY

The government is a puppet that the markets will ultimately control. This is the truth and the markets are starting to get angry today. As the debt ceiling talks continue to drag, the markets are starting to hit back. Early in the week, no agreement was a non event as there was a full week to maneuver. The markets had two small down days, dropping half a percent on the SPDR S&P 500 ETF (NYSE:SPY). Now Wednesday has arrived and there is less than a week to a possible default and downgrade of the United States debt rating.  As the markets start to collapse, the government will come together. Wall Street always wins. This should have been evident back in 2008 and 2009. When big money starts losing, the big boys come out and call the President and representatives.

For those of you that may doubt the control the stock market has over the government, just remember in late 2008 when TARP was originally voted on by the politicians. It failed to pass and the markets collapsed. The politicians, feeling the heat from their massive blunder, voted again and passed TARP.  This is the same thing that is going on now. The government is playing chicken with the markets and ultimately the stock market will win. A deal will be done.

The markets continue to trade lower, however, off their lows. Amazon.com, Inc. (NASDAQ:AMZN) reported great earnings last night but that good news was not nearly enough to keep the Nasdaq from falling close to 2% at the lows. Everything from Chevron Corporation (NYSE:CVX) to Apple Inc. (NASDAQ:AAPL) are getting pounded. The government will act soon. Just watch.

Gareth Soloway
InTheMoneyStocks.com

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