Please Keep Screaming!

You may know me, as an advisor and a writer (Making Lemonade, a Bright View on Investing, on the Economy and on the Financial Markets), to be an optimist. I've defended my bent over the years by pointing out how, in America, optimism, as history has shown, has been synonymous with realism...

And while I can easily spin Greece's present woes to the positive (nothing short of an epic crisis would ever cure its ills), I'd prefer not to title my next book America's Dark Before its Dawn... I'd prefer rather for us to understand that were it not for our amazing story; our fight for independence, freedom, entrepreneurship and global trade (resulting in the greenback becoming the world's reserve currency) and now, alas, the printing press, there'd be little today (from a fiscal-health perspective) separating the U.S. from the nations that dot Western Europe... Rational optimism aside, that's friggin scary!

Therefore, it is incumbent upon us Americans, Pollyannas and pessimists alike, to speak (scream) up and tell our policymakers we're done with it... We watched our friends and neighbors, hypnotized by what they saw as their own personal printing presses (their once ever-growing home equity), leverage themselves into swimming pools, boats, his and her jet skis, lavish vacations and sports cars, do the unthinkable - default on their obligations and destroy their personal credit ratings... And we're simply not going to stand by and allow our politicians to do the same...

The realist knows that the debt ceiling will see new heights in the near future... And while you may agree (in the near-term anyway) with the politicians that that's a good thing, I could make a very strong case that it's not... That it's akin to bribing the appraiser after applying for the refi... But of course it's going to happen; the "pain" that policymakers have convinced us would ensue if they had to slash the current budget by a couple $trill would be more, they say, than the global economy could bear... So I won't waste space here pleading for a no-deal... I'll instead point to the subtle clues that tell me we voters have our work cut out for us:

1. Ben Bernanke, when pressed by one libertarian Texas Congressman, recently stated that it was inaccurate to view the two QE programs as spending programs. In that the exercises themselves amounted to the Fed investing in fixed income securities... So then, Mr. Bernanke doesn't equate the printing of two trillion brand new dollars (whatever the reason) with spending...

2. Moody's recently issued a statement that suggested we do away with the debt ceiling altogether... They then turned around and warned that if we don't present a serious plan to raise it under the condition of long-term spending cuts, they'll downgrade the U.S.'s credit rating... So then, on one hand Moody's says get rid of the ceiling, that without it there'd be no threat of a downgrading... On the other, the ceiling itself puts the deficit under the spotlight, and inspires their threats, which inspires fiscal reform... Moody's and Bernanke are clearly on the same page...

3. President Obama recently complained that he'd much rather talk about things people want to talk about "like new programs and the NFL season"... "NEW PROGRAMS" Can you believe, in this environment, he said that?? (your classic Freudian slip)... President Obama, Bernanke, Moody's, and make no mistake my friends, their opponents as well, are all on the same page...

The difference is that you and I are no longer on their page, and that's what's screwing with Washington