Stock markets around the world react to every news report like pigeons in a park.  Huddled together in one strutting mass they move slowly around, clockwise, until the smallest cue strikes them. Suddenly, there is a small panic and the flock races counter-clockwise in a feathered flurry.  They stop, and then the heads all bob clockwise again for a moment.  After a few scratching moments a blind panic sets in and boom!  Counter-clockwise with a few desperate flaps of wings.

You may think that pigeons are not rational enough to run a financial system.  But if you want to find something in the news to explain the market’s behavior, you might as well consult the mooching birds at the nearest park.  Everything that stock markets are reacting to has been in the news for a very long time – they suddenly decided, for their own reasons, to start taking it seriously.

As today starts, the movement is staying very counter-clockwise.  The pigeons seem to have a purpose.

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The casual joke turns on China knocking on our door in the middle of the night on a repo call.  Like a lot of jokes it’s a way of laughing off a genuine fear – that they US is slowly being owned by a nation that isn’t exactly friendly and we have no reason to trust.  Paranoia sometimes sets in when people wonder why China would loan us all this money in the first place – has this been a plot all along?

A hard look at the Chinese Dragon shows that not only is there little to fear from them, they have far more reason to be afraid of us.  And they’re pretty open about it, too.

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As I am writing this, it seems that a deal has been worked out in Washington to avoid a federal default.  No one is happy with the deal, which is to be expected, but I sense that many people are livid about the process.  This is especially true for Progressives, who seem to view the entire experience as a massive defeat.

One good thing came out of it all, however – the public and the media are engaged in a discussion of our economy and what to do about it like never before.

I think it is time to pause for a moment and see just where we are in the national discussion before we move ahead.  This post is a series of polls that I hope will help us all focus on how this debate will stay engaged and productive.  As always, please leave your more general thoughts beyond the questions in the comments.

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