Update 741 — Fed Holds Rates; CPI 3.1%: (When) Can Fed Pivot from Long Pause?

The Fed’s almost two year campaign of high interest rates, painful medicine to fight the worst bout of inflation in 40 years, is proving out, impelling the Fed to hold interest rates at its current 5.25-5.50 percent range. Price increases fell again in November, led by moderation in the key energy sector — where the …

Update 741 — Fed Holds Rates; CPI 3.1%: (When) Can Fed Pivot from Long Pause? Read More »

Update 740 — A Supplemental Surprise: Political Timelines vs. Actual Emergencies

From the Middle East to Eastern Europe, Asia, and Central America, the world awaits Congressional action on the administration’s emergency supplemental request submitted two months ago. This week, an unanticipated set of GOP demands on comprehensive immigration reform and a separate one on conditions regarding aid to Israel have forced a legislative recalibration and another …

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Update 739 — SCOTUS Seems Moore Unsure: Re Congress’ Authority to Tax Certain Income

Shockwaves hit the tax policy world in late June when the U.S. Supreme Court agreed to hear Moore v. U.S., a case with broad implications regarding Congress’ authority to tax unrealized income. The Court rarely grants cert. on cases brought under the 16th Amendment, which grants Congress the right to levy a federal income tax.  …

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Update 738 — Immaculate Disinflation: Felt or Not, Prices Nearer Fed’s Target

Despite popular perception, statistics bear out the signs that the U.S. economy is not just withstanding the shock and duration of the Fed’s campaign to combat inflation. Unemployment at the lowest levels seen in decades, this week’s revised third quarter GDP gain of 5.2 percent, as well as the October data on prices, which we …

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Update 737 — Undersupply and Costs: Problems Besetting the Housing Market

The slumping U.S. housing market wallows in a 13-year-low in existing-home sales amid record high prices due to constrained supply and mortgage rates, now at a 22-year high. The Wall Street Journal reported today that home prices hit a record level in September, pushing homeownership further out of reach for an increasing number of Americans …

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Update 736 — Thanksgiving Leftovers: CR Signed; Room for December Items?

Now that Congress has passed and the President has signed the Continuing Resolution (CR) funding the government at current levels into early 2024, the opportunity arises for Congress to take up the many issues unaddressed during the House leadership elections and CR negotiations. We will leave these for consideration here until after the Thanksgiving break. …

Update 736 — Thanksgiving Leftovers: CR Signed; Room for December Items? Read More »

Update 735 — FY24 Funding Smoke Signals: Shutdown Threat on Hold Two More Months

A moment of comity prevailed late yesterday, on a day including physical threats in both chambers, when the House adopted Speaker Johnson’s early holiday gift of a clean, two-step laddered continuing resolution, with the Senate and President Biden expected to sign on and avert a government shutdown until January 19. Democrats provided a majority of …

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Update 735: Shutdown Threat In Temporary Remission

A moment of comity prevailed late yesterday, on a day including physical threats in both chambers, when the House adopted Speaker Johnson’s early holiday gift of a clean, two-step laddered continuing resolution, with the Senate and President Biden expected to sign on and avert a government shutdown until January 19. Democrats provided a majority of the House …

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Update 734 — Calm Before the Storm: Will CR Bring Christmas in November?

The halting progress on the FY24 appropriations bills since Speaker Mike Johnson’s election will itself likely come to a halt next week, with the current continuing resolution (CR) keeping the government open expiring at 12:01 am deadline next Saturday. With a CR extension or without one, this process will resume thereafter, but between now and …

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Update 733 — Aiming at Basil Endgame: GOP’s Copious Canards on Capital Rules

The House Subcommittee on Financial Institutions and Monetary Policy held a hearing yesterday featuring an attack on the Basel III Endgame capital requirements rule proposed by the Fed and other financial regulators in July. The comment period for the proposal is January 16. We have seen the banking industry’s ads on TV and social media …

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