"They are totally comfortable having a debate, even an ugly debate, on the budget. They see that as part of the governing process."
- A former administration official
No compromise on the debt ceiling. With these words began negotiations between Democrats and Republicans, as the U.S. government legal borrowing limit was reached more than two years ago. Amid the growing tensions, Obama's job-approval ratings tumbled to record lows. While Obama is testing a new strategy, refusing to make any concessions over terms for raising the debt ceiling, his new stance carries significant risks to the political standing. With no progress in these long and messy negotiations markets are getting worried whether a deal can be reached so the government will avoid falling behind on its payments. In case the agreement is not reached by mid-October, suggesting the White House should lift its debt ceiling, which is currently limited to $16.7 trillion, the government could face its first default on its debt obligations. Meanwhile, Republicans are expected to push for a one-year delay, known as "individual mandate", which is crucial provision of Obama's healthcare law introduced in 2010.
At the same time, the Conference Board said a measure of consumer confidence in the world's largest economy came in weaker than expected, reflecting concerns over the short-term outlook for the key labour market and earning. The CB Consumer Confidence Index plunged to 79.7 this month, down 81.5 in August and below expectations of a 80.0 figure.
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