1/12
The rest of the calendar year the focus will be on the the usual list stuff; Fed tapering, growth/employment, inflation, earnings, crypto regulation, etc.
But, the next biggest issue this calendar year is Washington/Budget/Infrastructure/Debt Ceiling.
A thread to explain
The rest of the calendar year the focus will be on the the usual list stuff; Fed tapering, growth/employment, inflation, earnings, crypto regulation, etc.
But, the next biggest issue this calendar year is Washington/Budget/Infrastructure/Debt Ceiling.
A thread to explain
2/12
And unlike the list above, the most important factor driving this issue is not discussed much at all, Biden's epic approval rating collapse.
Another raft of polls came out late Friday (yesterday) that tanked the rolling average of his approval rating even further.
And unlike the list above, the most important factor driving this issue is not discussed much at all, Biden's epic approval rating collapse.
Another raft of polls came out late Friday (yesterday) that tanked the rolling average of his approval rating even further.
3/12
Washington's conventional wisdom (rarely correct), was Biden approval rating would rebound after COVID peaked and Afghanistan headlines faded.
Both did and Biden keeps going down and down and has not shown any ability to make his approval rating "bounce."
Washington's conventional wisdom (rarely correct), was Biden approval rating would rebound after COVID peaked and Afghanistan headlines faded.
Both did and Biden keeps going down and down and has not shown any ability to make his approval rating "bounce."
4/12
How bad is Biden's 43.4% rolling average?
Trump's second half average (midterm Nov 6, 18 to Jan 20, 21) was higher at 43.8%.
Biden's current approval rating is now a below average Trump rating for his second half.
Biden is also below Trump on election day (red)
How bad is Biden's 43.4% rolling average?
Trump's second half average (midterm Nov 6, 18 to Jan 20, 21) was higher at 43.8%.
Biden's current approval rating is now a below average Trump rating for his second half.
Biden is also below Trump on election day (red)
5/12
Biden's approval rating is not good and he seems uncapable (at least for now) of making "number go up."
And with Afghanistan off the front pages and COVID receding, it is hard to see what event would make "number go up."
Biden's approval rating is not good and he seems uncapable (at least for now) of making "number go up."
And with Afghanistan off the front pages and COVID receding, it is hard to see what event would make "number go up."
6/12
Why does this matter? The Debt Ceiling is still out their in early December and the markets do not have much faith Biden has the political capital to get a deal in time.
Why does this matter? The Debt Ceiling is still out their in early December and the markets do not have much faith Biden has the political capital to get a deal in time.
7/12
The orange line is the bill curve as of yesterday's close.
The "kink" in December is money mkt funds selling Dec T-bills out of fear they will not pay on time and they will have to value them at zero until they do. This puts MM funds at risk of "breaking the buck."
The orange line is the bill curve as of yesterday's close.
The "kink" in December is money mkt funds selling Dec T-bills out of fear they will not pay on time and they will have to value them at zero until they do. This puts MM funds at risk of "breaking the buck."
8/12
Above was true a week ago but the Rs rode to the rescue.
But, last night McConnell sent a letter to Biden making it very clear that will not happen again.
Rs have now given Ds enough time to get a deal and they need to make it happen.
thehill.com/homenews/senat…
Above was true a week ago but the Rs rode to the rescue.
But, last night McConnell sent a letter to Biden making it very clear that will not happen again.
Rs have now given Ds enough time to get a deal and they need to make it happen.
thehill.com/homenews/senat…
9/12
My GUESS is McConnell knows the thinking of Joe Manchin (D, WV) and Kyrsten Sinema (D, AZ) and they are not budging.
And the progressive wing is dug in the other way as well. So, no path to a deal remains for any/all of this.
Some D has to cave and look bad. Who?
My GUESS is McConnell knows the thinking of Joe Manchin (D, WV) and Kyrsten Sinema (D, AZ) and they are not budging.
And the progressive wing is dug in the other way as well. So, no path to a deal remains for any/all of this.
Some D has to cave and look bad. Who?
10/12
If Biden was popular, like he was in the spring, he could tell one-side or the other what he wants and they would not dare defy him.
If Biden was popular, like he was in the spring, he could tell one-side or the other what he wants and they would not dare defy him.
11/12
But with Biden now sporting a below average Trump approval rating, and seems incapable of making "number go up" (approval rating).
Until "number goes up," no D will listen to Biden.
But with Biden now sporting a below average Trump approval rating, and seems incapable of making "number go up" (approval rating).
Until "number goes up," no D will listen to Biden.
12/12
Buckle up, Washington is hardly going away.
Lately a never ending stream of professional money managers on financial TV roll their eyes thinking it is a non-issue (literally happened earlier this week). Be careful, this story has a lot more "legs" than you think.
Buckle up, Washington is hardly going away.
Lately a never ending stream of professional money managers on financial TV roll their eyes thinking it is a non-issue (literally happened earlier this week). Be careful, this story has a lot more "legs" than you think.
Summary ...
All Biden has to do is make "number go up" and he can get a deal. But can he? What makes "number go up?" Remember Afghanistan is gone from the headlines and COVID is receding and number is not going up.
All Biden has to do is make "number go up" and he can get a deal. But can he? What makes "number go up?" Remember Afghanistan is gone from the headlines and COVID is receding and number is not going up.
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