Dollars, Stalemates, And Magic Lines

The week started with a deadline and ended with finger pointing. "We could do that before the election if the president wants to,” Nancy Pelosi told MSNBC Friday, referencing the ever elusive fourth virus relief package. Trump "has to talk to Senate Republicans," she added. A deal between Pelosi and Steve Mnuchin seemed imminent as late as Thursday, with both sides expressing optimism around a package worth some $2 trillion. Mitch McConnell and other Senate GOPers, however, indicated that even if a bill were drafted, blessed by Trump, and pushed through the House, its chances of becoming law were slim. Democrats blocked what they called a cynical bid by McConnell to resurrect a "targeted" relief bill from September, deriding it as a "sham." For his part, Trump insisted he could bring reluctant Republicans on board, but there was scant evidence to support the president's claim. Richard Shelby, for example, said the chances of a deal were "slim" on Friday afternoon, just before the closing bell on Wall Street. Mark Meadows held out hope, saying the door is open to a deal "in the next day or so," noting that Pelosi and Mnuchin are "making adjustments and trying to look at langua
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3 comments on “Dollars, Stalemates, And Magic Lines

  1. runamok says:

    The problem with the stalemate in the Senate is instead perhaps related to McConnell not being able to hold a gavel. Hence, they cannot convene. Maybe this has really been the problem all along. His hands, they would appear, have insufficient flexibility to grip said gavel, are a visible manifestation of the gerontocracy that is running this joint. …term limits, please.

  2. runamok says:

    That chart of the 10Y is something. There is going to be some high drama the next couple of weeks on this. Can’t wait to read about it. I guess all that TLT and EDV I bought, I better have my finger on the trigger in case there’s a runaway in 10y and 30y.

    The Fed is pretty competent. I can’t imagine they would lose control and let this runaway to 1.0%. Maybe let the carrot ride for a bit longer, see what happens in the Senate, see if it goes Dem, then slam-o-ru. Riveting.

  3. Anaximander says:

    The FED is a domestic banking authority. They simply are not tasked with, nor do I believe they much understand, the full magnitude of issues related to offshore dollar liabilities (so called Eurodollars, which are certainly not all in Europe). Simply put, this is not going to end well. There are a lot of Turkeys out there.

    It’s funny, I’ve been reading “The Raven of Zurich”, which I recommend for an Austrian economics / banking / political economy (i.e. non-Anglicized) perspective on the last great period of global transformation around the world wars. I’ll leave you with the following quote for weekend pondering, “In 1919-20, when European currencies were falling and the United States was going through a sharp recession, it would have been absolute suicide to contract heavy liabilities in Swiss Francs, the only solid currency of the continent.” For emphasis, I’d add that the US had also just taken a protectionist turn, restricting imports and immigration. These years are of course remembered for their widespread currency debasement.

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