Despite a late September market rally fueled by the hopes of additional stimulus, there is some indication this morning that talks are breaking down.
Pelosi had previously called for a deadline of noon on Wednesday to make a deal, but talks continued throughout the day and night yesterday.
This morning, word first broke from anonymous members sitting on the House Majority Whip call:
House Speaker Nancy Pelosi, on a private call with the House Democratic whip team Thursday morning, sounded very down about the prospects of a deal for a new stimulus package to respond to the Covid-19 pandemic and its economic fallout, according to two people on the call.
Pelosi repeatedly spoke of the “different values” held by Democrats and Republicans, making clear that even the latest offer from Treasury Secretary Steven Mnuchin fell far short of what was needed to deal with her view of the scale of the current economic issues.
https://www.cnn.com/2020/10/01/politics/stimulus-negotiations-latest-congress-pelosi-mnuchin/index.html
Meanwhile, the White House Press Secretary fired back, blaming Pelosi for the breakdown in negotiations:
White House Press Secretary Kayleigh McEnany on Thursday criticized House Speaker Nancy Pelosi’s approach to negotiations over another coronavirus aid package, in another sign that a deal on relief looks tough to achieve in a divided Washington. “Nancy Pelosi is not being serious. If she becomes serious then we can have a discussion,” McEnany said
https://www.marketwatch.com/story/white-house-spokeswoman-says-pelosi-not-being-serious-in-talks-on-coronavirus-aid-2020-10-01
Markets have largely shrugged off news of talks winding down, although there seems to be a sentiment that the recent rally has largely priced in expectations for additional stimulus and unemployment assistance.
Analysts and industry watchers from just about every sector are taking notice:
Today’s jobs report doesn’t indicate much progress has been made in stopping the loss of employment, although a pause in accepting new unemployment applications in California has delivered a lower nominal number than expected. Unfortunately, that also means we are unable to determine the exact number of jobs that were lost, this week, but the headline number is lower and that appears to fueling mania in the markets.
When will the music stop? Nobody knows!
But we’re probably about to find out that a whole bunch of chairs have gone missing since the last time we checked…