Just to put some comments on the Most devastating Weekend for Obama, the Rush to approve the Debt Ceiling Plan.
Since last week, Im not actually scared of the US Default with an estimate of just 10% chance to default, but at the end of Friday night in the U.S., it was rejected by the Republicans, setting to a 50-50 chance of Default/Downgrade. Obama and his team goes ahead on the weekend planning.
The DOW is now near its support which hit 12,000 intraday low, and is ready to take off while looking into charts, but It still ends up on U.S.'s final decision on its debt ceiling plan.
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Congress headed into the final weekend before a threatened U.S. default deadlocked over legislation to raise the debt limit as President Barack Obama appealed to party leaders to reach a compromise.
The Senate yesterday swiftly rejected a plan the Republican-controlled House passed hours earlier with no Democratic support. It would have required congressional approval of a constitutional amendment to balance the budget and forced another debt-limit vote by lawmakers in about six months to continue the nation’s borrowing authority beyond early 2012.
Congressional leaders “need to start working together immediately to reach a compromise that avoids default and lays the basis for balanced deficit reduction,” White House Press Secretary Jay Carney said in a statement after the two votes.
Senate Majority Leader Harry Reid, a Nevada Democrat, who offered modifications to a Democratic plan that he said are designed to attract Republican support, accused GOP leaders of rebuffing his efforts to negotiate.
Reid said when he attempted to engage Senate Republican leader Mitch McConnell of Kentucky in talks, “We had no one to negotiate with.”
“We’re missing Republicans,” said Senator Chuck Schumer, a New York Democrat, though with just days left to a possible Aug. 2 default, “that could change.”
‘Done Everything’
House Speaker John Boehner, an Ohio Republican, speaking before the House vote, said his party has “done everything we can to find a common-sense solution.”
Shortly after the Senate rejected Boehner’s plan, the House scheduled a preemptive vote for today on Reid’s proposal -- planning to defeat it even before the Senate takes it up.
Financial markets were restrained in reacting to the Washington impasse yesterday. Treasuries rallied, sending yields on 10-year notes to the lowest level since November. The yield on 10-year Treasury note yields declined 15 basis points to 2.79 percent in New York. Stocks fell as economic growth trailed forecasts. The Standard & Poor’s 500 Index slipped 0.7 percent and tumbled 3.9 percent this week for its worst slide in a year.
Lawmakers are working through the weekend. Senate procedures would allow an initial vote on Reid’s plan at about 1 a.m. tomorrow. A Senate vote then could be held at about 7 a.m. on Aug. 1, allowing the measure to return to the House before the Aug. 2 deadline.
To contact the reporters on this story: Julie Hirschfeld Davis in Washington at Jdavis159@bloomberg.net; Mike Dorning in Washington at mdorning@bloomberg.net
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