Wall Street calls moderates' bluff, urges investors to prepare for infrastructure and budget...

[DonViejo]

Wall Street calls moderates’ bluff, urges investors to prepare for infrastructure and budget reconciliation bills

PUBLISHED MON, AUG 23 202111:17 AM UPDATED AN HOUR AGO

Thomas Franck
@TOMWFRANCK

KEY POINTS

Wall Street thinks moderates are bluffing and says investors should prep for both an infrastructure bill and a $3.5 trillion reconciliation bill.

Morgan Stanley and others say it’s unlikely a group of nine Democrats will hold up President Joe Biden’s $3.5 trillion package of health-care and climate provisions.

Rep. Josh Gottheimer, D-N.J., said Congress should send infrastructure to Biden’s desk first and then consider the $3.5 trillion reconciliation plan.

Major Wall Street brokerages are urging clients to look past Democratic infighting and prepare for a torrent of new government spending as House Speaker Nancy Pelosi brings two historic measures up for a vote.

Strategists say that moderate Democrats hoping to persuade Pelosi, D-Calif., to vote on the bipartisan infrastructure bill before a $3.5 trillion budget resolution will ultimately concede for fear of risking their reelection chances in 2022.

“Our base case has been and remains that Congress will approve” a significant expansion of fiscal policy, Morgan Stanley’s head of public policy, Michael Zezas, wrote in a note published Monday.

“Democratic leadership is behaving as if they’ve made the calculation that neither bill has the votes to pass independently of the other one,” he added. “Our base case assumes that this reality ultimately persuades the group of House moderates to support the budget resolution vote and allow the dual track process to continue, though perhaps not without some attendant headlines and/or modest concession.”

more
https://www.cnbc.com/2021/08/23/wall-street-says-to-prep-for-infrastructure-and-budget-reconciliations-bills.html

[WHITT]

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they've seen Speaker Pelosi's track record.

[crickets]

2. K&R for visibility.