Boy, oh boy, Tuesday morning’s missive from former FX trader turned Bloomberg contributor Richard Breslow reads like a summary of this week’s Heisenberg talking points.
Or wait. Maybe it’s the echo chamber effect at work. That is, maybe this week’s Heisenberg talking points read like a summary of Richard Breslow’s recent missives.
Either way, this morning’s installment is great.
Although Trump dropped some hints yesterday as to what he’s going to say this evening, that doesn’t give us as much to go on. Why? Well, because this really is just as much about Trump himself as it is about policy.
The President’s first solo presser was a clinic in crazy, with the bellicose billionaire going off the rails on bizarre tangents about everything from the price of drugs (“cheaper than candy barzzzz”), to nuclear weapons (“you’ve heard of uranium right?”), and the media (“the news is fake, because so much of the news is fake”). He even managed to inadvertently (one hopes) ostracize entire ethnic groups, religions, and genders. So there’s a very real chance that tonight’s speech could be accompanied by Trump’s trademark ad hoc lunacy.
There’s also the planned trolling by Democrats to take into account. As noted here on Sunday and as CNN recounted this morning, “multiple Democratic members of Congress have announced their intentions to bring immigrants with them to President Trump’s speech on Tuesday.” This should make for a raucous, circus-like atmosphere.
But Dems need to be careful because as Breslow notes, Steve Bannon is a maestro when it comes to turning the tables on his enemies (after all, this is a man who, despite being the undisputed king of fake news, somehow managed to not only deflect criticism from Breitbart, but convince large swaths of the American public that it’s actually the real news that’s fake – what the f*ck, right?).
Finally, you’ll note that while US markets will be closed for all the retail, home gamers out there, a lot of real traders around the world will be glued to their terminals as this sh*t show unfolds. Or, as Breslow more eloquently puts it, “it won’t be just Americans watching, subject to its content, nor trading on its message.”
Below, find some of the best market-related color you’ll read today with regard to Trump’s speech.
Via Bloomberg’s Richard Breslow
As you probably heard, the President will be addressing Congress tonight. Dribs and drabs of the speech have been coming out, but it’s fair to say that we won’t know enough about it to draw conclusions until it happens. Why? Because how it’s delivered will matter. There’s as much ongoing confusion and dispute about what this man is all about as on whatever policies he manages to see enacted in his first 100 days. Or six months for that matter.
- The opposition, too, will be scrutinized. The decorum within the chamber will matter. Nothing will fire up his base as much as seeing a raucously misbehaved crowd. The Democrats present should play it straight and let any outrage come from elsewhere, including the rebuttal. Steve Bannon and Stephen Miller didn’t get him this far by not using the opposition against itself
- We in the markets are, of course, looking for details on specific fiscal stimulus plans. The level of specificity demanded is probably unrealistic and, perhaps, petulant. It’s the job of Gary Cohn and Steve Mnuchin to give the granular particulars. And, frankly, that’s a better way to do it and won’t make it less so
- I was struck yesterday at just how quickly markets reacted to the mention of infrastructure spending. At every point on the yield curve. He’ll need to deliver something credible and believably big tonight, but there was little in traders’ reactions to suggest they think it would be DOA in Congress. And people obviously think the Fed will be paying more than careful attention given the repricing of futures contracts.
- The speech has a lot to do with fiscal policy. But it won’t be the only subject. And Trump is a stump speaker who has shown little reticence to ad-lib. It won’t be just Americans watching, subject to its content, nor trading on its message
- Incidentally, it’s month-end and there are large extensions expected in the Treasury market as well as dollars to be sold at the fixes. Don’t get psyched out into thinking these flows imply somebody knows something
