disastrous default if the debt ceiling is not raised. During negotiations, the Democrats have made proposals that the Republicans can’t abide, including ending tax breaks for energy companies and owners of corporate lear jets. The GOP would rather cut such trifles as Medicare and Medicaid. Rep. Eric Cantor (VA), Republican House majority leader, recently walked out of debt ceiling negotiations held by Vice President Biden. Cantor, though, stands to profit enormously should the country default due to his investment in a mutual fund "whose performance is directly affected by debt ceiling brinkmanship":
Last year the Wall Street Journal reported that Cantor, the No. 2 Republican in the House, had between $1,000 and $15,000 invested in ProShares Trust Ultrashort 20+ Year Treasury EFT. The fund aggressively "shorts" long-term U.S. Treasury bonds, meaning that it performs well when U.S. debt is undesirable. (A short is when the trader hopes to profit from the decline in the value of an asset.)
According to his latest financial disclosure statement, which covers the year 2010 and has been publicly available since this spring, Cantor still has up to $15,000 in the same fund. Contacted by Salon this week, Cantor's office gave no indication that the Virginia Republican, who has played a leading role in the debt ceiling negotiations, has divested himself of these holdings since his last filing. Unless an agreement can be reached, the U.S. could begin defaulting on its debt payments on Aug. 2. If that happens and Cantor is still invested in the fund, the value of his holdings would skyrocket.