MORNING MESSAGEThe “People’s Fed” and the Oracles of Jackson Hole
The chair, Janet Yellen, gave a lengthy speech last week that covered a number of topics, but this was the phrase heard around the world: “I believe the case for an increase in the federal funds rate has strengthened in recent months.” ... Interest rate hikes are a tool for cooling down the economy when it’s “overheating.” That hardly seems to be the case right now ... a “People’s Fed” proposal from Fed Up [would] avoid taking steps that could harm the economy for working people, like a premature rate hike, and appoint leadership that more closely resembles our diverse population.
Buzzfeed begins four-part series on investor-state dispute settlement courts, a key feature of TPP: “The BuzzFeed News investigation … will show how the mere threat of an ISDS case can intimidate a nation into gutting its own laws, how some financial firms have transformed what was intended to be a system of justice into an engine of profit, and how America is surprisingly vulnerable to suits from foreign companies … Companies and executives accused or even convicted of crimes have escaped punishment by turning to this special forum.”
Fed conference explores how to blunt next recession. W. Post: “Its influential interest rate is barely above zero. That means the Fed could enter the next economic slowdown with its foot already firmly on the gas … When the global financial crisis struck in 2008, the Fed had to get creative … Fed Chair Janet L. Yellen said the central bank will probably redeploy those measures when recession strikes again, an acknowledgement that the unconventional policies of the crisis have now become the norm.”
Fed appears to reject “radical” proposals. Bloomberg: “Federal Reserve Chair Janet Yellen and her peers … re-affirmed their belief in power of monetary policy to stop economies from slipping into deflation. They were less keen on academic proposals that included the abolition of cash, raising their inflation targets, or keeping permanently large balance sheets.”
Trump sets oft-canceled immigration speech for Wednesday. The Hill: “On Sunday evening, Donald Trump promised in a tweet that he’ll deliver a major speech on immigration Wednesday — saying he’s still looking for a larger venue … Trump had planned to address the issue last week in Colorado, but postponed that event. The Arizona event scheduled for Wednesday was originally billed as an immigration speech, but the Trump camp then said it would focus on party unity instead. It was cancelled Friday, before Trump clarified that it is moving to a larger venue.”
Trump still pushing “hardline” reports Bloomberg: “…the totality of Trump’s recent remarks reveals only one meaningful change in his immigration platform: an apparent retreat from mass deportation … Trump remains opposed to legal status for undocumented immigrants, and on Saturday he reaffirmed his support for many of the restrictive proposals laid out in his August 2015 policy paper.”
Trump to stump in black church Saturday. Bloomberg: “Trump will visit the Great Faith Ministries on Saturday in Detroit, a predominantly black church located in the heart of the city … Trump has been direct in his approach on the campaign trail, though he’s made his appeals in front of predominantly white crowds in suburban areas.
Coal country skeptical of Clinton’s aid plan. NYT: “As in the case of tobacco, the idea is not to save the old economy, but to create a new one by retraining miners, investing in infrastructure and technology, and luring new industries … lawmakers in Virginia created the Tobacco Region Revitalization Commission, which has spent nearly $1 billion … But southwest Virginia is still suffering … Mrs. Clinton’s advisers say her plan to save coal country is informed by the lessons of the tobacco programs.”
Dems hope for House gains. NYT: “…Democrats in Congress are laying the groundwork to expand the list of House Republicans they will target for defeat … Democrats are particularly enticed by Mr. Trump’s dwindling support in affluent suburban areas — including those near Kansas City, Kan.; San Diego; Orlando, Fla.; and Minneapolis … Few Democrats say they believe their party is positioned, at this point, to take control of the House …[But l]ast month, the House Democratic campaign raised $12 million while House Republicans raised just $4.6 million…”
Pool of undecided voters leans left. Politico: “They’re more likely to come from a demographic — younger voters — that’s more inclined to back her, and in some surveys have a slightly less negative view of her than of Trump. And yet they’ve resisted supporting her all year, and are actively seeking other options, such as [Gary] Johnson or [Jill] Stein … part of the reticence among young voters [is] their fervent support for Sen. Bernie Sanders … More than a quarter of voters under age 35, 27 percent, said they would vote for Johnson and Stein, combined.”
Congress faces bill to keep government open. The Hill: “Funding for the federal government dries up at the end of September, forcing Congress to move a stopgap spending bill just weeks before the Nov. 8 presidential election. Members of the conservative House Freedom Caucus are pushing to extend government funding into early 2017, wary of a massive bipartisan spending deal in the lame duck. But GOP leaders and House Democrats are already laying the groundwork for a short-term continuing resolution or CR that will set up a vote on a catch-all spending bill right before the holidays.”
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