Get into bonds

Cantor’s Loss a Bad Omen for Moderates – NYTimes.com.

The obvious upshot of a move to an even more conservative / reactionary Republican House is that debt ceiling and government shutdown are back on the table. Since it didn’t work very well the last time, could ideology / childishness trump common sense?

Yes, if as a Member you’re most concerned about getting elected back home. No, if you’re concerned about not turning over House, Senate and Presidency to the Democrats in 2016.

Creative destruction is the economic idea that out of bankruptcy, new firms and ideas will come to the fore and establish an even firmer foundation. Perhaps Republicans need some creative destruction.

In the mean time, maybe it’s a good idea to rebalance your portfolio on the theory that the market will take a dive over the next two years.

On the other hand, political pundits love to get excited – sound and fury and all that.

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