Commentary:
I still think we need to see a Republican split to get something passed. But I think at this point, the Republicans believe that it is in their individual and collective interests to push things down to the wire. First, the Democrats blinked last time we got to the precipice. So it makes sense for the Republicans to try it again. As long as a deal is done before January, this represents a ‘free option’ for the Republicans. Secondly, Boehner will have a much easier time corralling the moderate Republicans at the precipice. This is key because the Tea Party nut heads probably won’t bend no matter what, which is why a Republican split is necessitated. I think the Democrats know this too. Note the Times article on Obama’s ‘lackadaisical’ schedule next week. This suggests the timeline for a bounce may have gotten extended a bit…
Notable:
- Some Republican House aides suggested that Mr. Obama was trying to raise the pressure on Republicans with his lackadaisical approach ahead of a trip to Asia and a Thanksgiving break. True negotiations, they say, will not begin until December, just weeks before the deadline. – NYT
Upcoming Data:
- Mon: NAHB Survey, US Existing Home Sales, BoJ
- Tues: US Housing Starts, Bernanke Speech
- Wed: BoE Minutes, US Jobless Claims, Markit Preliminary PMI
- Thu: EU PMI , Canada Retail Sales
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