I am trying to examine who is the Tea Party as now there is a real battle within the Republican Party of the normal Republicans and the Tea Party.
Why it is important to you? If they had won, the US would have gone over the Debt Ceiling and the market would have crashed possibly creating a 2008 scenario.
So the battle between the normal Republicans and the Tea Party Republicans is important as the next Government closure/Debt Limit is 15 Jan 2014 and 7 February 2014. And any evolution of this battle will be felt immediately on the stock market – possibly even end of November 2013.
The Tea Party historical foundation lay in 1773 in the Boston Tea Party (the Americans refused to pay the tax of tea to the English and defied what was, at the time, the largest world superpower). Rhetoric apart, the first recent activities are to be found in 2001 and the movement started to support its own candidates from 2009.
The Tea Party is essentially a decentralized party based on Judeo-Christian values without an uniform agenda.It is labeled conservative, libertarian and populist with teh aim to return to the basic USA (Founding Fathers Documents).
A series of non-negotiable points are
1. Illegal aliens are here illegally.
2. Pro-domestic employment is indispensable.
3. A strong military is essential.
4. Special interests must be eliminated.
5. Gun ownership is sacred.
6. Government must be downsized.
7. The national budget must be balanced.
8. Deficit spending must end.
9. Bailout and stimulus plans are illegal.
10. Reducing personal income taxes is a must.
11. Reducing business income taxes is mandatory.
12. Political offices must be available to average citizens.
13. Intrusive government must be stopped.
14. English as our core language is required.
15. Traditional family values are encouraged.
How they are fairing in the election
Loosely speaking they seem to be in a “declining pattern”, but in April 2012 approximately 44% of Americans (including ex US Chairman Greenspan loosely agreed with their view). Declining, but still a force to be recon with.
2010 mid term election NBC identified 138 Republicans Tea Party (129 Senate and 9 House – 32% won). It was in general a big win.
In 2012 election they were still a considerable force, but not anymore as a new storming political force.
Current Situation
Speaker of the House Boehner has been seem to be bending too much to the “loud, but still a minority” Tea Party and that he needs to stand against the Tea Party (specially Texan Senator Cruz – held as an hero on his return to Texas). He will be tested on new issues soon (immigration, farming bill and budget) and show the Republican Party direction.
The Tea Party is also not too much concerned with the Presidency of the US, so they can play hard ball, but also they are raising powerful enemies such as the US Chamber of Commerce and the American Trucking Industry Association.
The outcome of this very American battle will shape the markets in the very near future. My forecast that a defeat of the US Tea Party could trigger a massive “blow off” rally by year end.
Related articles
- Poll: Congress, tea party take hits from shutdown (cbsnews.com)
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