Investors very likely will find uneventful Congress’s return from August break. Odds are high that the dominant political parties are properly incented to avoid a government shutdown at the end of this month.
The continuing resolution (CR) to prevent near-term fiscalamity could become a vehicle for other matters such as instructing a less onerous permitting process for oil and gas pipelines. The deal Senator Machin included in the reconciliation law comes with a promise from President Biden and Senate Majority Leader Schumer that the Federal Energy Regulatory Commission will act. Unsurprisingly, more than a few House Democrats oppose the move. Our sense is the risk(s) of disappointing Manchin outweigh the pain environmentalists and House Democrats might produce. The administration wants the CR to include funding for Covid therapeutics ($22.4 billion), Ukraine military and humanitarian assistance ($13.7 billion, disaster relief ($6.5 billion), and monkeypox treatment ($4.5 billion).
Congress is also poised to complete action on the FY23 national defense authorization. Less certain are the fates of two pending bills that would regulate tech companies (please see our August 30 email: Big Tech Regulatory Risks Impacted by the Calendar), and cryptocurrency legislation still scheduled for House Financial Services Committee action on September 14th. We remain skeptical that Congress will pass stablecoin or any other legislation related to digital assets this year.
WEEKLY OUTLOOK (all times eastern daylight unless otherwise mentioned)
Tuesday
2:30 a.m., Bruegel’s two-day annual conference of global economic insights begins
Wednesday
5:00 a.m., BoE Governor Bailey presents the August monetary policy committee report to the Select Treasury Committee of Parliament
9:50 a.m., Cleveland Fed bank’s Mester (voter) speaks at a MNI webcast
10:00 a.m., Senate Foreign Relations committee closed briefing on Russia’s invasion of Ukraine
2:00 p.m., Fed Board vice chair for supervision Michael Barr (voter) discusses financial stability at the Brookings Institution
Netherlands set to receive a report on building two new nuclear reactors
Thursday
9:10 a.m., Fed Chair Powell speaks at CATO
12:00 p.m., Chicago Fed’s Evans speaks at the College of DuPage
Friday
EU energy ministers meet in Brussels to discuss a price cap on Russian oil and winter fuel preparations.
EU finance ministers gather in Prague to assess economic conditions.
REMINDER: Many of the topics mentioned in this note will be covered during our September 13 macro webinar for clients. Four guest specialists will discuss the midterms, the post-election market-relevant DC agenda, cryptocurrencies, and China. Please contact us, your 22V Sales representative, or hit this LINK to register for our virtual conference (11:00 a.m.–1:00 p.m.).
