Investors fired a broadside today at the shenanigans surrounding Washington's debt negotiations, killing a Wall Street rally over what should have been anticipated news that Moody's rating service would lower the U.S. AAA credit rating if a deal is not reached.
Moody's officially joined the Standard & Poor's credit rating service in warning Congress and the White House that they need to do a deal, or else the U.S. could find itself in another financial crisis like the one that crippled markets and wiped out fortunes and 401ks in the summer of 2008.
Moody's disclosure that it would put the U.S. "under review" had been expected, yet with the financial markets so volatile it was enough to kill a rally on Wall Street and send the dollar and 10-year Treasury note downward. The U.S. stock exchanges mostly ended on a positive note, but they still pulled back in the final hour of trading on the Moody's news.
Apparently the rally-killing news did little to shake up the players around the negotiating table at the White House, where President Obama and House GOP leader Eric Cantor locked horns at what was described as a contentious meeting.
Cantor told reporters Obama became "agitated" when the Virginia Republican suggested a short-term deal, prompting the President to warned him not to "call my bluff."
Obama, who has firmly stated he will not accept a short-term deal, then pushed away from the table and left the meeting.
"I know why he lost his temper," Cantor said. "He's frustrated. We're all frustrated."
Obama aides later reportedly described Cantor's explanation "overblown."
The testy parlay today, however, will not keep the negotiators from meeting again tomorrow back at the White House for the fourth straight day.