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Consensus Starts To Form That Congress Is Horrible: Seven And A Half Things To Know

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DEBT CEILING DEBATE
How John Boehner may respond to Congress's leverage rapidly disappearing in the debt ceiling debate. | AP

Science has determined that people need to know 7.5 things per day, on average, about the world of business. You can't argue with science. Lucky for you, the Huffington Post has an email newsletter, delivered first thing every weekday morning, boiling down the day's biggest business news into the 7.5 things you absolutely need to know. And we're giving it away free, because we love you, and also science. Here you go:

Thing One: Ceiling Watch! Congressional Republicans may have leverage in the debt-ceiling debate, but it's an asset that is quickly turning toxic.

President Obama displayed this yesterday in an uncharacteristically frisky press conference, in which he called a breach of the debt ceiling "irresponsible" and "absurd" and warned it could cause markets to go "haywire" and "wreck the entire economy." He also called Republicans hostage takers, accusing them of "negotiation with a gun at the head of the American people'' and warning that "they will not collect a ransom in exchange for not crashing the American economy."

Obama is stealing a note from Karl Rove: Hammering at his opponent's strength until it is a weakness. In this case, the Republicans' strength is their ability to not raise the debt ceiling. The debt ceiling only lets Congress borrow more money to pay bills already racked up, as Obama pointed out. But Republicans see the debt-ceiling vote as a way to extract some spending cuts out of Obama. It's real leverage, but it's getting harder by the day for them to use it. "The escalation (and simplification) of Obama's rhetoric is designed by his own acknowledgement to take the debt limit entirely out of play as a bargaining chip by making it too hot to handle and thus non-negotiable," writes David Lawder of Reuters.

Assisting Obama in this effort yesterday was Federal Reserve Chairman Ben Bernanke, who compared refusal to raise the debt ceiling to a family refusing to pay its credit-card bill. Except in this case the global economy is at stake: “Default would increase our borrowing costs and damage economic growth and therefore add to future budget deficits, not decrease them," Bernanke warned.

Republicans probably won't listen to Obama or Bernanke (or Tim Geithner, for that matter, who issued his own debt-ceiling warning yesterday). But they may well listen to corporate leaders, whose profits were smacked down at least partly by the fiscal-cliff debate at the end of 2012, Bloomberg points out. That could be one reason the Chamber of Commerce has already warned Republicans not to push their luck with the debt ceiling. Without allies, Republicans may be losing the debt-ceiling fight before it has even begun. And that's good news for the economy.

Thing Two: Time To Just Order One Of Those Wrist-Slapping Machines Already: The Fed and the Office of the Comptroller of the Currency must have chapped hands this morning, after all the slaps they delivered to the wrists of JPMorgan Chase yesterday. They delivered not one but four wrist slaps to the biggest U.S. bank by assets, the Wall Street Journal writes, ordering it to get a better handle on its risk controls after its London Whale trading losses last year and to keep a better eye on money laundering, among other things. No fines were issued, thank goodness, because bank fines make the ghost of Adam Smith cry. But JPMorgan CEO Jamie Dimon might get part of his bonus pinched; an internal report on the London Whale trade, due today, will likely hold him at least partly responsible. Giving up some of his bonus is the absolute least he can do. Meanwhile, British regulators have launched their own probe (just now?) of the London Whale loss.

Thing Three: You Might Not Have Dell Stock To Kick Around Any More: Shares in rapidly fading computer maker Dell soared 13 percent yesterday on news that it is in talks with a couple of private-equity firms about a buyout. This marks the umpteenth time such rumors have been floated, and most analysts were skeptical that such a large deal could happen easily. Dell is worth about $22 billion, and business is lousy. But there are real private-equity names attached to these particular rumors, so they might be a little more valid.

Thing Four: Housing Market Noticeably Less Nightmarish: The number of American homeowners who owe more on their house than it's worth has fallen to 7 million from 12 million at the worst of the housing crash, Bloomberg writes, and that number could fall to just 4 million in a couple of years. "The housing market is rebounding faster than anyone thought possible," a Blackstone analyst told Bloomberg. Then again, Blackstone would say that: It is aggressively buying single-family houses to try and profit on a housing rebound.

Thing Five: Facebook To Introduce Something: That electric charge you don't feel in the air is the energy of an eager nation anticipating the mystery thing that Facebook is going to introduce to the public today, the New York Times writes. Whatever will it be? Meh, probably some kind of search function that will give you more targeted and personally tailored results than Google can give you, because it owns the rights to your immortal soul. "That kind of service would delight advertisers — and, by extension, Wall Street," the NYT writes.

Thing Six: Chrysler's Crazy Comeback: Auto sales have rebounded from the Great Recession, and no U.S. auto maker has benefited more than Chrysler, the New York Times writes. "Chrysler outperformed the industry last year with a 20.6 percent increase in domestic sales in a market that grew by 13.4 percent."

Thing Seven: Hedge Fund Manager Can't Stop Fighting With People: Hedge-fund manager Dan Loeb, not content to fight with other hedge-fund manager William Ackman over the merits of Herbalife, has taken a stake in Morgan Stanley to pick a fight with it over executive compensation, the Wall Street Journal writes. Loeb has already wondered why directors at Morgan Stanley, the Jan Brady to Goldman Sachs' Marcia, get paid more than directors at bigger, more complex banks like JPMorgan and Citigroup.

Thing Seven And One Half: Poop-Flinging Monkeys Could Not Be Reached For Comment: A cat named Orlando was better at picking stocks than a team of investment professionals and a group of students, in a year-long experiment by the British paper The Observer. The cat gained nearly 11 percent on the year, compared with a 3.5 percent gain for the pros. The students lost money. What was the cat's approach to investment? "[T]he cat selected stocks by throwing his favourite toy mouse on a grid of numbers allocated to different companies."

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Calendar Du Jour:

Economic Data:

8:30 a.m. ET: Producer Price Index for December

8:30 a.m. ET: Retail Sales for December

8:30 a.m. ET: Empire State Manufacturing Survey for January

Corporate Earnings:

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-- Calendar and tweets rounded up by Alexis Kleinman.

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