Left to right (screen grab)
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"You might say the president knows the bond market better than me. But based on that comment, I don’t think that you do."
CNBC's Rick Santelli had a fascinating back-and-forth Friday with Politico’s Ben White and Business Insider’s Josh Barro over the possibility of a government shutdown, the White House's efforts to reduce the deficit, and the looming debt ceiling fight.
White started out by explaining how an Obamacare-related government shutdown now could be a good thing for markets.
“I think [a shutdown is bullish for markets] because it means there’s less chance of a debt ceiling crisis if you get a shutdown,” White said Friday on CNBC.
“I think if we punt this thing off to the debt ceiling in couple of weeks or a couple of months, then you get more of a crisis,” he added. “You get a situation where Republicans say, ‘We’re not voting to raise the debt ceiling unless you give us something on Obamacare and a lot more spending cuts.’”
Later, while the three discussed the White House's efforts to reduce the deficit, Barro told Santelli: "I think the president understands the bond markets better than you do."
Santelli, who has spent years reporting from the floor of the Chicago Board of Trade, was visibly amused with Barro's comment.
Lastly, the three discussed Republicans’ continued efforts to cut back on government spending and repeal Obamacare. Barro said it appears Republicans are backing away from their current strategy, explaining that if the government ends up in a shutdown, or misses a bond payment, they're afraid they'll get blamed for the economic repercussions.
White agreed, adding that the Obama administration has good reason not to back away from its current "we will not negotiate" position on the debt ceiling.
“The White House doesn’t want to enshrine this notion where you can ask for this laundry list of demands and if you don’t get them, you’re going to blow up the economy,” White said.
“The economy is not going to blow up,” Santelli said, referring to the possibility of the U.S. missing a bond payment.
"You know what?" he added. "You might say the president knows the bond market better than me. But based on that comment, I don’t think that you do.”
Watch the discussion unfold here [things heat up at around the 04:40 mark]:
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