While the media has focused on the short term debt issue matters and to a lesser extent the long term implications what they have not addressed is the way this Circus has impacted the credibility of the USA Capital Markets.
The political rhetoric and the refusal to deal with the issue at hand will have a lasting impact on the way the world looks at investing in America.
Since 2008 the Government and those elected to represent the American people have made reactionary, over bearing legislation based on there popularity on the given day.
Dodd-Frank, Capping Financial Institutions Wages, Over Regulation and Excessive Prosecution are creating an exodus of talent from Wall St to Asia.
– New hedge funds in Asia raised $2.86 billion in the first half of 2011 with multi-strategy funds attracting two-thirds of the inflow, a survey from industry tracker AsiaHedge showed on Wednesday.
Most of the assets were raised by a handful of big funds with the number of launches falling to 24 from 70 in the same period last year when new funds had gathered $2.8 billion.
The asset flow, helped by launches such as former Goldman Sachs trader Morgan Sze’s Azentus and Orvent Asset Management Pte in Singapore, is closest to the pre-crisis level of $5.7 billion raised in the first half of 2007.
It is also a big jump from 1.1 billion raised in the second half of 2010.
This is part of a wider trend created by the White House, New York will lose it’s role as the financial center of the world.
The shift will reduce demand for US Treasuries over the next decade, more companies will seek new listings in Asia, and the balance of power would have moved away from the USA.
The companies them selves are in great shape, corporate profits are setting records, companies have never had as much cash as they do now, the only problem is a manufactured crisis of faith inspired by a President driven by popularity polls.