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Public servants are being targeted and MPs have been murdered. But we will
prevent fear from destroying our politics | Dan Jarvis
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A new law will restrict protests outside the homes of public office
holders. The right to demonstrate is a given, but to menace private homes
is just not...
29 minutes ago
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“I wouldn’t pay much attention to Wall Street’s assessment of politics,” said Barry Ritholtz, a money manager and proprietor of the Big Picture blog. “Let me remind you that the Street bet heavily on Romney, in both donations to campaigns and how they positioned their portfolios. They misread what turned out to be an Electoral College blowout of 332 to 206, and the sell-off since the election is as much about the mispositioned Street reversing themselves as anything else.”
Analysts can describe the contours of a deal, which are obvious. A cliff-averting deal would consist of an agreement to raise revenue by doing one or more of the following: closing loopholes, eliminating deductions for high earners, changing rates on income, capital gains, and dividends. And it is true that there are rising signs of capitulation from the right. Glenn Hubbard, the dean of Columbia’s business school, who was Romney’s chief economic adviser and stood to be the Federal Reserve nominee, went on Morning Joe Monday to wave a white flag of sorts. “We’re going to have to have some compromise. And I think step one is figure out how to raise some revenue without killing the economy.”
But the GOP is still a party of anti-tax absolutists. Despite their defeat at the polls, the party’s top elected officials and economic thinkers—including Hubbard—haven’t really budged from the notion that higher revenues should only come from eliminating deductions, and that tax rates should stay exactly where they are. Meanwhile, Rep. Paul Ryan, now rested and removed from the vice presidential campaign, is back in the House and set to play a leading role in the talks, The New York Times reported on Monday. This does not bode well, since Ryan, the Randian situational deficit hawk, opposed the Bowles-Simpson Commission’s deficit-reduction plan, even though he was a member. Despite having spent his entire adult life in Washington, Ryan has yet to show an ability to make bipartisan legislative deals on taxes and spending. Meanwhile, House Speaker John Boehner presides over a fractious majority that includes several lame ducks, and President Obama is demonstrating uncharacteristic spine.
As a result, I find this bit of financial-political punditry more compelling than the optimistic talking points we’ve seen: “We interpreted last Friday’s press conference on progress in the fiscal cliff negotiations as little more than a photo-op, and we expect that these negotiations will drag on into the beginning of next year,” said Chris Bury, co-head of U.S. rates at Jefferies, the New York investment bank.
Meanwhile, the most important reactions to the hostage situation aren’t evident in the broad stock market indices. Rather, we should look at what individual companies are doing as they start to reckon with the facts that the hostages may not be released by Jan. 1. Wynn Resorts this week will pay out a special, $7.50-per share dividend, the better to take advantage of today’s lower tax rates on dividends, which are now in jeopardy. Walmart on Monday moved its dividend that it was supposed to pay on Jan. 2 up to Dec. 27, the better to avoid higher taxes.
The Dow Jones Industrial Average may be showing confidence in a deal. But the retailer that is one of the index’s constituents isn’t so sure.
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