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China update — MM is told by a senior White House official that despite all the drama a phase one deal remains “very close.” This person believes the Chinese will come through with significant concessions on intellectual property protections and that the two sides are not that far apart on exactly which tariffs will come off and when.
Of course, we’ve heard this before — There was a call between the main players Monday night (USTR Robert Lighthizer, Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He) so at least talks are continuing toward some type of announcement. Still no word on exactly when such an announcement would take place.
Getting a Chine deal done remains a top Trump priority ahead of 2020 along with signing USMCA. Trump riffed on USCMA during his press availability on Monday and suggested the Mexicans and Canadians might walk away if it drags on too long.
The real fear, according to my Morning Trade colleagues, is not that they would walk away but that Democrats might demand changes that would be too difficult for Mexico, in particular, to handle. [More below]
U.S. could let 301 deadline for France slide — A Trump administration decision about whether to revive a Section 301 trade investigation into the potentially harmful effects of France’s new digital services tax could slip past today’s deadline and into next month, a senior administration official told me. USTR launched the probe earlier this year, claiming the tax unfairly discriminated against big U.S. Internet companies like Facebook, Google and Amazon.
GOOD TUESDAY MORNING — Two more days until Thanksgiving! Let’s hope nothing too crazy happens between now and then. Email me on email@example.com and follow me on Twitter @morningmoneyben.
Case-Shiller Home Prices at 9:00 a.m. expected to rise 0.4% … Consumer Confidence at 10:00 a.m. expected to rise to 126.8 from 125.1
MORE ON CHINA from my Morning Trade colleagues Chinese officials briefing foreign visitors in Beijing last Friday were positive about the trajectory of the talks but said the scope and scale of U.S. tariff de-escalation is still an open question, according to one person familiar with those discussions.
The phone call among the top officials likely means that Lighthizer and Mnuchin will not travel to Beijing this week for another round of talks, two people said. Trump’s tough talk on China wanting a deal more than the U.S. conceal a real desire to get a market-calming agreement, and he is being pushed by Mnuchin and senior adviser Jared Kushner to do so
“The deal is largely there if Trump offers the substantial tariff relief the Chinese want,” the person said, adding that the depth of any tariff roll back the president agrees to will reveal the extent to which Trump wants to seriously engage in subsequent phases of trade talks.
PELOSI SOUNDS POSITIVE ON USMCA — Our Sabrina Rodriguez: “Speaker Nancy Pelosi said Monday that House Democrats and the Trump administration have worked out their issues on the USMCA, but she wants to see it in writing before declaring victory.
“‘We are within range of a substantially improved agreement for America’s workers. Now, we need to see our progress in writing from the Trade Representative for final review,’ Pelosi said in a statement. … Pelosi and Democrats have repeatedly said they need to be sure the new pact includes stronger enforcement mechanisms before a House vote could be held.”
DEMS STALLED ON TRUMP TAXES — WSJ’s Brent Kendall: “The Supreme Court granted President Trump’s emergency request to suspend enforcement of a congressional subpoena seeking his financial records from his accounting firm, a move that could keep the documents from House Democrats for months—if they see them at all.”
STABLE COORDINATION — From MM’s European Morning Exchange colleagues: “A global body is needed to round up financial supervisors and help them develop a unified strategy for stablecoins like the Facebook-led digital currency Libra, a Bundesbank executive said Monday. ‘You need one central entity delivering such a role,’ Dr. Joachim Wuermeling said during a debate in Brussels titled ‘Facebook’s Libra from a banking supervision perspective.’”
BIG CONGRATS to our colleague MICHAEL KRUSE, who won the National Press Foundation’s Everett McKinley Dirksen Award for Distinguished Reporting of Congress.
OCC GEARS UP FOR RED-LINING RULE — Our Victoria Guida scoops: “The Office of the Comptroller of the Currency is gearing up to propose the first overhaul of a landmark anti-redlining law in decades, a plan expected to broaden the definition of the communities a bank serves in the digital age and to create new ways to measure lenders’ compliance.”
HOUSE CMTE COULD VOTE ON LIBRA — Our Zachary Warmbrodt scoops: “The House Financial Services Committee may vote next month on legislation designed to rein in Facebook’s Libra digital currency and others like it, the latest backlash against the social media giant’s plans to tap into consumers’ wallets.”
BLOOMBERG ON DEBATES: WHATEVER — Following on MM’s reporting from Monday, our Zach “Debate Guru” Montarello: “Michael Bloomberg doesn’t plan to collect donations for his presidential campaign. That means he won’t appear in the next Democratic debate — and risks missing the half-dozen debates planned for next year. …
“Bloomberg has signaled that he won’t contest DNC rules governing participation — and isn’t particularly perturbed by missing the debate. ‘It is up to the DNC. They can set the rules,’ Bloomberg told reporters in Virginia on Monday. ‘If they set the rules where I qualify, I would certainly debate. If they set the rules where I don’t qualify, then I won’t.’”
BLOOMBERG HITS THE ROAD — Our Maya King: “The billionaire businessman and former New York City mayor said his choice to begin campaigning in Norfolk, home to the world’s largest naval base, was aimed at appealing to swing voters in heavily conservative areas. He argued that his mayoral experience, combined with his knowledge of … Trump’s politics, gave him a unique appeal to conservative southern Virginians, especially after a series of decisive wins for Democrats in the state.
MM MAIL BAG — Better Markets’ Dennis Kelleher emails: “[Y]our headline and quote in MM … from Laura Noonan’s FT piece on European banks US operations will mislead anyone who doesn’t read the entire article. The headline.. clearly suggests those assets are being pulled out of the US. … However, those assets are not being ‘pulled’ from the U.S. — they are being moved within the U.S. to avoid Fed regulation”
INVESTORS DANCE WITH THE FED — Mohamed A. El-Erian on Bloomberg Opinion: “The markets and the Federal Reserve have been engaged in a peculiar dance over the last year, with a large initial mis-alignment over the two parties’ interest-rate expectations having giving way to a truce that could now be put at risk due to increasing market pressure on the central bank to cut rates.”
CASH DASH MIDDLEMEN — Tik Root, Mark Fahey and Rosie Cima for Newsy and POLITICO Magazine: “A Newsy analysis of Federal Election Commission data found that since the start of the 2008 election cycle, federal political campaigns have paid more than $220 million to credit card-processing companies including American Express, Bank of America and PayPal, among dozens of others.
“Between the 2008 and 2016 election cycles, the amount nearly doubled, from $28.2 million to $51.5 million. The 2020 cycle is on pace to shatter that record: Through October, the 2020 campaigns spent more than $23.8 million in processing fees — more than a year before the election.”
INVESTORS PUNISH COMPANIES WHO HIRE FEMALE BOARD MEMBERS — Bloomberg’s Jeff Green: “An analysis of 14 years of market returns across about 1,889 companies finds that when they appointed female directors, they experienced two years of stock declines. The market value of a given company fell 2.3% by adding one additional woman. The research was published in the Informs journal Organization Science.”
WELCOME TO THE WORLD — Alex Panetta, Washington correspondent at the Canadian Broadcasting Corp. and a POLITICO alum, and Silvia Malgioglio, who works at the World Bank, on Saturday welcomed Olivia Panetta, who came in at 7 pounds, 2 ounces.
MORGENSON TO NBC — Per NBC email: “I am delighted to announce that Gretchen Morgenson will join the NBC News Investigative Unit as Senior Financial Investigative Reporter on December 2. “
TRANSITIONS — Via email from Seth Unger: “This is my last week at Treasury after nearly three years overseeing the Office of Terrorism and Financial Intelligence portfolio for our Public Affairs office. …
Per email from CFP Board’s Dan Drummond: “I am moving on to start my own communications firm, Commonwealth Public Affairs, LLC” …
Alicia Berhow has been hired as state director of government affairs for Charter Spectrum. She previously was SVP of government affairs at the Orange County Business Council.