* Here is a fascinating chart from Andrew Prokop that overlays where the Republican presidential candidates stand in the polls and the amount of money each has spent on television ads. What is clear is that the “establishment” candidates are running “establishment” campaigns.
* Lots of financial news today. Congress reached a deal on the omnibus spending bill and will vote on it by the end of this week. We’ll see how that goes because there’s still some rumbling about it. But the big news is that none of the Republican riders (defunding Planned Parenthood, repealing Obamacare, rejecting Syrian refugees, rolling back EPA regulations/Wall Street reforms, etc.) are included.
* The Federal Reserve raised its target interest rate by a quarter point. Wall Street saw big gains immediately afterwards. Some say that credit goes to Yellen.
Market analysts said Yellen, at least initially, had pulled off a remarkably smooth shift in policy in a way that should not create much turbulence in the short-term, boosting Democrats’ hopes for running on a strong economy next year.
* Jared Bernstein writes that these two things (omnibus spending bill and Fed rate hike) signal a flip in fiscal vs monetary policy.
Last night, the Congress apparently reached a deal on both the budget and a tax package. The budget deal appropriates about $1.1 trillion in discretionary spending next year ($548 bn for defense, $518 bn for non-defense) and the tax cuts come with a $650 bn, 10-year price tag. I’m pretty sure that amounts to “positive fiscal impulse” meaning a bit more spending this year than last. Since government spending feeds directly into GDP, that boosts growth a bit…
What’s interesting today is that Congress appears to moving slightly from neutral to positive fiscal mode while the Fed, after seven years at zero, is moving the other way.
* I’m always fascinated by how the folks at Red State respond to Republican primary events. After last night’s debate, Leon Wolf – who openly states that Cruz is his first choice and Rubio his second – was pretty unhappy.
…people who realize that Trump represents an existential threat to the credibility and future existence of the conservative movement as a political force have been forced to grind our teeth as Cruz – who really has been a champion for our causes – held fire on this charlatan for months. Now we are treated to the spectacle of Cruz treating Rubio in the same way many of us wish he had treated Trump from day one? It’s frankly galling.
* Midnight last night was supposed to be the deadline for signing up for health insurance via the Obamacare exchanges. But because of a surge in interest, the enrollment period was extended for 48 hours.
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