The longer the stalemate in Washington goes on, the more damage it is doing to the economy.  Top line growth will suffer as a consequence.

I am pessimistic and my equity exposure reflects this.  Currently at about 11%, I am looking for opportunities to pick up "blue chip" stocks (at least to me they are) as they come down with everything else.  An example is JNJ which is down close to 10% from it's highs and I think is good value, so I bought some.  Not super-cheap mind you, but cheap nonetheless.

Over time it has not paid well to be out of stocks, so I am looking for a sign to buy back my hedge.  Once the shenanigans in DC are past, stocks will rally, I believe.  But we have to play the waiting game.  It also is difficult to try to time the market - one is rarely able to "pick the bottom" as it were.  I think the best we can hope for is to buy into the down move progressively.

JPS and JTP and PFF continue to be some of my favorites.  These preferred stock based Closed End Funds trade with fantastic yield and in the case of the first two, offer substantial discounts to their NAV (net asset value).  To me, 8% yield is a fantastic result even if rates rise.