{"id":1937718,"date":"2023-05-25T07:21:10","date_gmt":"2023-05-25T11:21:10","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/stocks-stand-to-suffer-massive-losses-if-debt-deal-isnt-reached-in-next-week\/"},"modified":"2023-05-25T07:25:41","modified_gmt":"2023-05-25T11:25:41","slug":"stocks-stand-to-suffer-massive-losses-if-debt-deal-isnt-reached-in-next-week","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/stocks-stand-to-suffer-massive-losses-if-debt-deal-isnt-reached-in-next-week\/","title":{"rendered":"Stocks could face huge losses without a debt deal next week."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">22<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fstocks-stand-to-suffer-massive-losses-if-debt-deal-isnt-reached-in-next-week%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1937718&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>Debt Ceiling Negotiations Could Spell Disaster for Stock Market<\/h2>\n<blockquote>\n<p><span class=\"ArticlePage-articleBody-firstLetter\">T<\/span>he stock market is set to plummet by a large degree should <a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/tag\/debt-ceiling\" target=\"_blank\" rel=\"noopener\">debt ceiling<\/a> negotiations drag into the coming days with no deal on the table.<\/p>\n<p>The White House and congressional Republicans, led by House Speaker Kevin McCarthy (R-CA), are <a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/news\/house\/chip-roy-outlines-debt-ceiling-priorities-to-gop\" target=\"_blank\" rel=\"noopener\">currently embroiled<\/a> in <a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/policy\/economy\/political-pressure-debt-ceiling-default\" target=\"_blank\" rel=\"noopener\">the worst<\/a> debt ceiling standoff since 2011, when House Republicans and then-President Barack Obama failed to reach an agreement until just days before the date that the <a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/tag\/treasury-department\" target=\"_blank\" rel=\"noopener\">Treasury Department<\/a> said it would exhaust its borrowing authority.<\/p>\n<h3>Make or Break: This Week into Next is Critical Window for Debt Ceiling Negotiations<\/h3>\n<p>That 2011 deadlock, the closest the United States has ever come to defaulting, shows the toll that the current impasse might have on the markets as negotiations continue to inch closer to the Treasury\u2019s current June 1 deadline, the earliest the government could run out of cash. During that standoff in 2011, the S&#038;P 500 lost about 17% of its total value.<\/p>\n<p>This week, the market began to react to the lack of a deal, although it has not yet posted declines comparable to 2011. The S&#038;P 500 has only fallen by about 2.2% since Friday, but absent a deal, those declines are expected to quickly accelerate.<\/p>\n<p><b><a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/policy\/economy\/this-week-critical-window-debt-ceiling-negotiations\" target=\"_blank\" rel=\"noopener\">Phil Toews, CEO of Toews Asset Management, warns that this week is a critical window for <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/exclusive-mitch-mcconnell-led-effort-to-trash-bob-dole-aides-career-over-peripheral-tie-to-january-6\/\" title=\"Exclusive \u2014 Mitch McConnell Led Effort to Trash Bob Dole Aide\u2019s Career over Peripheral Tie to January 6\">debt ceiling negotiations<\/a><\/a><\/b><\/p>\n<ul>\n<li>Markets hate uncertainty, and there is probably no financial event that we\u2019ve experienced in recent history that is more uncertain in terms of the outcome with Treasurys and stocks than what we\u2019re potentially going to experience right now.<\/li>\n<li>The downward slide in the stock market is just starting to show this week, but the situation could become very painful very fast.<\/li>\n<li>If <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/stocks-stand-to-suffer-massive-losses-if-debt-deal-isnt-reached-in-next-week\/\" title=\"Stocks could face huge losses without a debt deal next week.\">stocks start posting bigger declines<\/a>, investors who see that could begin to panic and <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/new-dc-gun-dealer-sees-business-boom-after-overcoming-city-roadblocks\/\" title=\"New DC Gun Dealer Sees Business Boom After Overcoming City Roadblocks\u00a0\">start selling<\/a>. That could create a domino effect for other investors and trigger huge losses.<\/li>\n<\/ul>\n<p>The dynamics of 2011 are remarkably similar to the political landscape of this latest debt fight. In 2011, Democrats controlled both the White House and the Senate while Republicans held the House (though Republicans held a much larger majority in 2011 after the Tea Party movement helped sweep a large number of fiscally conservative budget hawks into office).<\/p>\n<p>Something that happened in 2011 that could also happen today, and which would roil the stock market, is a downgrade of the country\u2019s credit rating. Amid the fracas, S&#038;P announced it was downgrading the country\u2019s credit rating below AAA (outstanding) for the first time in history.<\/p>\n<p>Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said there is the potential for another credit downgrade this time around as the U.S. inches closer to the X date, which is when the Treasury runs out of cash. The odds of a downgrade only increase each day that ticks by.<\/p>\n<p>McCarthy <a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/news\/house\/mccarthy-negotiators-meet-white-house-debt-ceiling-talks\" target=\"_blank\" rel=\"noopener\">announced that talks<\/a> between his negotiators and Biden\u2019s team would move from the Capitol to the White House on Wednesday and expressed hope they can \u201cfinish up negotiations\u201d there. Although, he said the two sides are still \u201cfar apart\u201d on several issues, including spending caps.<\/p>\n<p>\u201cYou have to spend less than you spent last year. That&#8217;s not that difficult to do,\u201d McCarthy said. \u201cBut in Washington, somehow, that is a problem. They have increased spending with the Democrats in the majority. &#8230; We can find waste; we can eliminate that.\u201d<\/p>\n<p><b><a class=\"Link\" href=\"https:\/\/www.washingtonexaminer.com\/\" target=\"_blank\" rel=\"noopener\">CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER<\/a><\/b><\/p>\n<\/blockquote>\n<p>Investors and advisers have \u201ccompletely missed\u201d the risk signals around the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/3-biden-admin-negotiators-leave-team-working-on-iran-nuclear-deal-because-biden-being-too-soft-report\/\" title=\"3 Biden Admin Negotiators Leave Team Working On Iran Nuclear Deal Because Biden Being Too Soft: Report\">current negotiations<\/a>, warns Phil Toews, CEO of Toews Asset Management. As the days tick closer to June 1, fear could begin to show quickly in the markets. He said the country is in \u201cunprecedented territory.\u201d<\/p>\n<p>\u201cI think it looks a little bit like a cliff, where it\u2019s risk-on and risk-off. So at this point, we\u2019re close enough to the date where negative momentum could just suddenly accelerate, and sometimes negative momentum begets more negative momentum,\u201d Toews warned.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Obama clashed over the issue. If a deal is not reached soon, the stock market could suffer a significant drop.<\/p>\n","protected":false},"author":1,"featured_media":1937719,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[3715,5487,4540,4342,10467,3912],"class_list":["post-1937718","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-deal","tag-debt","tag-huge","tag-losses","tag-stocks","tag-week"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1937718","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1937718"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1937718\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1937719"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1937718"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1937718"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1937718"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}