Okay, everyone switch sides:
Republicans Boehner and McConnell both say they are willing to put revenue on the table.
Democrats Pelosi and Reid say they recognize the need to curb spending; Pelosi says she is "confident" that a solution is in sight, she says they can reach a deal well before Christmas, Reid says they won't wait until the last day to get deal done.
The chances of a deal being announced over the weekend is vanishingly small. No matter: the biggest loser in this game today is...volatility. The Volatility Index (VIX) simply collapsed, down almost 4 percent, near the lows for the week.
Two important signs of possible bottoms:
1) home builders: oversold. Home builders are up big today and have gone a long way to repairing the damage in the last week. The stocks are dramatically oversold, and the worries about them are perhaps a bit oversold as well. To wit: worries about reducing or eliminating the mortgage interest deduction and FHA insolvency.
Eliminating the deduction on second homes would certainly hurt areas with a big second-home market, but those areas are relatively small (Florida, coastal Carolinas). For primary homes, reducing the mortgage interest deduction (allowing a deduction of only, say, the first $500,000 of a mortgage) may put some pressure on higher priced homes, but these are primarily in New York, California and Massachusets.
2) dividend payers (utilities, REITs, closed-end funds, telecom, some closed-end funds) are stabilizing today. In particular, closed end funds which trade at premiums or discounts to their underlying investments have been hit hard this week. The largest, the PowerShares CEF Income Portfolio is a fund of closed end funds, dropped nearly 8 percent in a couple days but has since rebounded.
(Read more: 'Fiscal Cliff'—America's Looming Economic Crisis)
—By CNBC's Bob Pisani
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