Held in low regard

While our leaders won't face international pressure to abdicate, as we saw in Italy and Greece, the U.S. electorate isn't impressed; it gives Congress a record-low approval rating of 13% right now, according to Gallup. Nor are the Chinese: The Dagong rating agency said this week that it may downgrade the U.S. credit rating again (it cut our rating back in August) on a failure of elected leaders to deal with the deficit. Wall Street isn't impressed, either.

A deadlock in Congress now, one that likely wouldn't be broken until after the 2012 election as divisions harden, would result in a cascade of failures that will continue to pummel stocks, confidence and the economy. Merrill Lynch/Bank of America economist Ethan Harris expects at least one U.S. credit rating downgrade in late November or early December as a result of a failure by the supercommittee to create a "credible" deficit-fighting plan.

Even if the bare minimum $1.2 trillion deal gets passed -- likely with accounting gimmicks such as overly optimistic economic growth projections -- a number of other major decisions loom over the next year that will require hard-to-come-by bipartisan support. These include expirations of the $90 billion payroll tax cut, $40 billion in extended unemployment benefits, tax incentives for business investment and the Bush tax cuts, as well as another decision on the U.S. Treasury's debt ceiling.

In the months to come, if the two parties battle as the economy burns, the solution embraced in Italy and Greece-- unelected technocrats -- may look more and more attractive as the deus ex machina to get us out of this mess.

Greek philosopher Plato warned of this more than 2,400 years ago in ancient Athens, claiming that the absolute freedom of democracy and the freedom of speech and license to do as one wishes can devolve into an unmanageable state. He compares such a place to a dilettante with no discipline; a hedonist with neither order nor necessity nor an appetite for sacrifice and self-control.

The country, drunk on the insatiable desire to have no master in any facet of life, becomes intolerant of any whiff of elitism, fiscal responsibility or denial of any earthly desire. Leaders aren't allowed to place the least bit of austerity on their people. To stay in power, they must be pliable and provide plenty of what the people want -- namely, low taxes and lots of government spending.

Otherwise, they are punished. Think about that when the 2012 elections roll around.

More immediately, on the investing front: I've been advising trade-minded subscribers to my newsletter on ways to try to catch the market's ups and down for the last few months -- ups and downs that are set to continue, and require quick action to try to play.

For average investors, it's much tougher, because the market is moving based on politics and macroeconomics rather than anything a particular company does. There are also few attractive alternatives. Treasury yields are in negative territory and are likely to underperform over the long haul. So for now, hang on.

Be sure to check out Anthony's new money management service, Mirhaydari Capital Management, and his investment newsletter, the Edge. A free, two-week trial subscription to the newsletter has been extended to MSN Money readers. Click here to sign up. Mirhaydari can be contacted at anthony@edgeletter.com and followed on Twitter at @EdgeLetter. You can view his current stock picks here. Feel free to comment below.