Forgot to include that quote from J.P. Morgan, explaining why he didn’t short stock (who knows if he really did?): “Don’t sell short the United States of America.” Eric Cantor evidently disagrees.
The Wall Street Journal reported the other day (here it is, but it’s behind a paywall) that as of his last disclosure form, House Republican leader Eric Cantor owned shares in a mutual fund that is short long-dated U.S. Treasury bonds. He is, in other words, betting that interest rates will rise, and hoping to make money off the fall in prices that would cause. (For my ancient primer on why bond prices fall when interest rates rise, see here.) Cantor is in a position to help the U.S. default on its… Read More