Conveniently coming just as warned that according to the T-Bill market, the odds of a government shutdown are now the highest they have been this cycle, moments ago Trump tweeted what appears to be a warning that the debt-ceiling process is setting up for failure, saying he had requested that Mitch McConnell and Paul Ryan tie the debt ceiling legislation into the V.A. Bill (which passed), adding that they did not do it, and as a result we "now have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy-now a mess!"
I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval. They...— Donald J. Trump (@realDonaldTrump) August 24, 2017
...didn't do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval. Could have been so easy-now a mess!— Donald J. Trump (@realDonaldTrump) August 24, 2017
The implication: the fingerpointing has begun over what even Trump now admits will be a debt-ceiling "mess" has begun, as has the scapegoating, and in Trump's view the blame will, or should, ultimately fall on Congressional Republican leadership in the face of McConnell and Ryan. While it is unlikely that Trump's latest escalation will accelerate a compromise, it virtually guarantees that the feud between the republican controlled Congress and the President will escalate further, effectively making either a debt-ceiling or government shutdown crisis increasingly likely.
Meanwhile, the stock market continues to blissfully ignore what the bond market is saying, which as we showed moments ago, has pushed the implied odds of a shutdown to the highest yet.