Wall Street to Boehner: Back off the debt ceiling
A lot of powerful political actors wouldn’t really have cared if the government shut down for a few days while the two parties hashed out their differences. That’s not so with the debt limit, and they’re making sure John Boehner knows it:
House Speaker John Boehner (R-Ohio) has had conversations with top Wall Street executives, asking how close Congress could push to the debt limit deadline without sending interests rates soaring and causing stock prices to go lower, people familiar with the matter said. ... The Wall Street executives say even pushing close to the deadline — or talking about it — could have grave consequences in the marketplace.
“They don’t seem to understand that you can’t put everything back in the box. Once that fear of default is in the markets, it doesn’t just go away. We’ll be paying the price for years in higher rates,” said one executive.
In 2008, Wall Street supported the Democrats because they were tired of George W. Bush. In 2010, Wall Street supported the Republicans, because they didn’t like the new regulations President Obama was proposing and the mean words he was saying about them. The GOP would like to hang onto that Wall Street money for 2012, and that won’t happen if they attach so many demands to raising the debt ceiling that the market starts to freak out and all of these investors begin to lose money. Republican leaders will have this in mind as we get closer to crunch time.
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