WASHINGTON (MaceNews) – The following is Wednesday’s status check of developments in the U.S. that can influence economic, health and political outcomes:
- It was unexpected and significant, when of all people the president of a Federal Reserve Bank spoke up to say something is seriously wrong in how the country is preparing for the next phase of the pandemic. Boston Fed chief Eric Rosengren’s warning was jarring because it was not in the numbing context of a partisan broadside.
- “Limited or inconsistent efforts by states to control the virus based on public health guidance are not only placing citizens at unnecessary risk of severe illness and possible death – but are also likely to prolong the economic downturn,” Rosengren said. He also said it would be very bad news if there is no agreement on more fiscal stimulus. His Fed colleagues Kaplan and Daly were much softer in their day’s remarks. The story about Rosengren’s comments is at macenews.com.
- Viewed by a nonpartisan outsider, the nation’s posture seems to be one of somnambulance. Not only are no virus relief negotiations under way or likely to get under way, the daily briefings by President Trump, once composed of virus topics, have devolved into long recitations of campaign talking points with only partial reference to health.
- More familiar are the words of Senate Republican Leader Mitch McConnell. Totally partisan yet still not on the White House happy-talk wavelength: “Our country is approaching another small-business tipping point and workers could begin getting pink slips instead of paychecks.” For McConnell, it is the Democrats’ fault.
- Earlier the White House economic policy coordinator Larry Kudlow said he saw a self sustaining recovery in progress.
- And Treasury Secretary Stephen Mnuchin said Democrats are lying, particularly House Speaker Nancy Pelosi. He issued a statement saying, “Earlier today, Speaker Pelosi and I spoke by phone. Her statement is not an accurate reflection of our conversation. She made clear that she was unwilling to meet to continue negotiations unless we agreed in advance to her proposal, costing at least $2 trillion. “
- Pelosi had said, “An overture was made by Secretary Mnuchin to meet and he made clear that his televised comments from earlier today still stand: the White House is not budging from their position concerning the size and scope of a legislative package.”
- To recap, President Trump is indicating no inclination to enter any talks himself, makes clear he’s not intending to give Pelosi anything she can claim as a win, Mnuchin’s negotiating sidekick Meadows is out for the week, the House is gone until or unless there’s a negotiating breakthrough and the Senate is mostly vacant, sputtering along in pro-forma sessions with no legislative business.
- Yet talking heads who are market participants continued to say Wednesday they are confident a deal will be done. U.S. stocks ended strongly positive with the DJIA up 1.05%, the S&P up 1.4% and the Nasdaq gaining 2.12%. The pre-pandemic CARES Act posture of fiscal policy makers, the Congress, of doing nothing much while the Fed carries the load, is back in place, yet the Fed is constrained by new rules to do only lending, not spending.
- Newly chosen Kamala Harris and candidate Joe Biden debuted as a couple with a pair of statements that showed the playbook versus Trump is coming together. Coverage is ample elsewhere but the bottom line seemed to be the opposition has come to life.
- The USTR office said it’s doing some minor rearrangement of the Airbus tariffs on Europe goods, increasing the pain slightly for France and Germany, reducing it a little for the UK.
- Despite his aides saying a promise to “terminate” the payroll tax if re-elected did not mean PPI, came in hotter than expected. The U.S. Treasury 10-year yield climbed then backtracked somewhat, to 0.667%.
- The virus kept up its pace of mortality, with 1,450 new fatalities in the past 24 hours (NYT Tracker). The confirmed caseload continues to flatten, down 18% from two weeks ago. Total fatalities 165,800. Asked about the high death toll, particularly in contrast to peer countries, President Trump chose not to answer, instead repeating the high number of cases is due to the high level of testing, a thoroughly debunked proposition.
- he would end the tax that supports Social Security and Medicare, President Trump repeated that in his Wednesday evening briefing to make it even more specific. Social Security would be instead supported by the government’s general fund, bolstered by “tremendous growth.”
- In upcoming economic data, the latest’ week’s fresh claims for unemployment benefits at 8:30a ET along with import and export prices. The morning’s Consumer Price Index, like Tuesday’s business inflation measure, the PPI, came in hot while the Treasury 10-year yield climbed, then backtracked to 0.667%.
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Edited by Denny Gulino (denny@macenews). Content may appear first or exclusively on the Mace News premium service. For real-time email delivery contact tony@macenews.com. Twitter headlines @macenewsmacro.