Here's to continued US partisan conflict

ARGUABLY the most relevant assessment of the current situation on Wall Street appeared last week in The New York Times and was reprinted in BT on Wednesday: "US partisan conflict is at historically high levels, but the market doesn't care", which outlined two truths about politics and the market.

"The first is that partisan conflict doesn't just seem to have become more intense this year. It has reached new levels of nastiness. The second is that the stock market simply doesn't care. In fact, the rising acrimony has been a fine environment for stocks, though possibly detrimental to the economy itself."

There is a monthly Partisan Conflict Index, which is maintained by the Federal Reserve Bank of Philadelphia, that searches newspaper databases to measure the frequency of articles reporting lawmakers' disagreement about policy. At the moment, the index is at an all-time high - and so is Wall Street.