| | | | | |  | | By Ben White | Presented by The Bouqs Co. | With help from Renuka Rayasam and Myah Ward IMPERFECT INFORMATION — Stocks dropped today, but they're still higher for the week after popping in dramatic fashion when Pfizer and German firm BioNTech reported very positive results from their Covid-19 vaccine trial. President-elect Joe Biden's clear win over the weekend also killed some investor anxiety over (non-fanciful) legal battles. But most of the exuberance was for the vaccine. For the first time in forever, investors snapped up beaten down "value" stocks including airlines like American along with travel and leisure companies. The Covid-induced collapse in travel and non-homebound entertainment crushed these stocks the last nine months. At the same time, investors dumped high-flying tech companies like Netflix, Zoom and Amazon on the theory that we will all soon evacuate our work-from-home caves and trudge to our offices, see movies in theatres and shop in real life stores. Wait, really? Hang on. This all seems pretty nuts. The Pfizer news was great, but investors should have anticipated it. It's long been assumed that an effective vaccine would emerge by next year. The theory of "efficient" markets that incorporate all available information suggests there's no reason Zoom was worth 85 percent of its previous value at the end of the day Monday. After all, you're not supposed to be able to find a dollar on the street: If it was real somebody else would already have snatched it up. And there are some obvious facts we're ignoring. A vaccine remains at least months away. The list of unanswered questions includes how long immune protection from the vaccine will last. Meanwhile, the virus itself is raging totally out of control across much of the country. State and local governments are either imposing or considering fresh lockdowns, not preparing to set newly vaccinated and spendthrift people free from confinement. New York Mayor Bill de Blasio said today the city would stick to plans to shut down public school again if the infection rate hits 3 percent. It's now at 2.52 percent. It all left some veteran traders puzzled and fearing Wall Street was once again jumping way ahead of where progress on the virus really stands and how long it might be until decimated sectors of the economy recover. "I do feel strongly that the market rally over the last seven months has eliminated the market's 'margin of safety,' SeaBreeze Partners' Doug Kass wrote in a client note today. "We are a bit more than 15 percent overvalued relative to my 'fair market value' of 3000-3100" on the Standard & Poor's 500. Stocks sagged today after Congress (yet again) indicated no more stimulus will likely arrive for struggling businesses and unemployed workers before early next year and as the new lockdown plans emerged. A larger reckoning on Wall Street may still loom. But what if it really IS the end of the virus? Markets are forward looking. Or they are supposed to be, which is why they should have priced in the vaccine emergence given what we already knew. But some investors tell The Nightly that the vaccine rally is warranted. The success rate was significantly higher than expected. So maybe this wasn't a stray dollar lying on the ground. It was a fresh bit of good news getting gobbled up. "I don't think it was so much the vaccine as the success rate. Greater than 90 percent was unexpected," Richard Bernstein, former Merrill Lynch chief investment strategist and founder of RBAdvisors, said in an email. "That's way more than season flu shots' success rates. If you want hope, then over 90 percent gets you very excited. I think even [Dr. Anthony] Fauci sounds encouraged, and he should know." Welcome to POLITICO Nightly. Reach out at bwhite@politico.com and rrayasam@politico.com, or on Twitter at @morningmoneyben and @renurayasam.
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Sen. Mitt Romney (R-Utah) talks to reporters in the Senate subway following a vote at the U.S. Capitol. | Getty Images | | | | CYBER INSECURE — The U.S. government's top cybersecurity official has told people that he expects the White House to fire him, three people familiar with the situation told Eric Geller and Natasha Bertrand, as the Trump administration continues a purge of officials deemed disloyal to the president. Chris Krebs, the director of DHS' Cybersecurity and Infrastructure Security Agency, is in the White House's crosshairs in part because of a website he created to debunk election-related misinformation — much of which Trump and other Republican leaders have embraced as they seek to undermine the legitimacy of Biden's victory. In another sign of trouble for CISA, which has for years avoided the chaos of the Trump administration, another top agency official submitted his resignation today. Bryan Ware, the leader of CISA's Cybersecurity Division, confirmed his departure to POLITICO but did not identify a reason. However, a U.S. official familiar with the matter told Reuters that the White House requested his resignation. Krebs, one of the few Trump administration officials with widespread bipartisan support and admiration, has been expecting to be fired since just after Election Day, according to three people familiar with his thinking.
| | | | TRACK THE TRANSITION, SUBSCRIBE TO TRANSITION PLAYBOOK: The definitive guide to what could be one of the most consequential transfers of power in American history. Our Transition Playbook newsletter—written for political insiders—tracks the appointments, people, and power centers of the new administration. Don't miss out. Subscribe today. | | | | | | | | A FIRST LADY FIRST — Jill Biden would scramble into cocktail dresses in a bathroom at Northern Virginia Community College before rushing to White House receptions when her husband was vice president. She graded papers at night in a tiny nook on Air Force Two. Her Secret Service agents dressed like college students and carried backpacks to blend in when she was on campus. Now "Dr. B," as her students call her, plans to continue teaching English and writing at the college when she moves into the White House in January, education reporter Nicole Gaudiano writes. She will be the first president's wife to continue her professional career as first lady, after becoming the first second lady to do so. She will also be part of a small group of union members to hold the title, including Eleanor Roosevelt and Nancy Reagan. "It would be a real modernizing of the first ladyship ... to have the president's spouse live the kind of life that the majority of women live, which is working outside the home professionally," said Ohio University professor Katherine Jellison, who studies first ladies.
| | | |   | | | | | | Welcome to Bidenology, Nightly's look at the president-elect and what to expect in his administration. Tonight, we look at Biden's experience in the world of arms control. Senior national correspondent Bryan Bender emails Nightly: Biden will be arguably the most experienced president in history when it comes to nuclear arms control — and one of the staunchest advocates for treaties to limit atomic arms ever to preside in the Oval Office. More than 40 years ago, he faced down Soviet premier Alexei Kosygin in the Kremlin as a 36-year-old U.S. senator dispatched to Moscow to discuss the arms control pact between Cold War adversaries known as SALT II. "We did not trust each other," Biden recalled of the 1979 meeting in one of his final speeches as vice president in 2017. "But neither of our nations wanted to be responsible for unleashing a nuclear apocalypse." "He's lived this stuff for almost half a century," says Jon Wolfsthal, a top White House nuclear adviser when then-Vice President Biden was tasked by President Barack Obama in 2010 to secure Senate approval of the New Strategic Arms Reduction Treaty with Russia. "He was the point person for getting the treaty ratified." Saving New START may be one of Biden's first major tasks when he is sworn in on Jan. 20. The last remaining arms control treaty between Washington and Moscow, New START is set to expire on Feb. 5 unless both sides agree to extend it for up to five more years. Biden has pledged to accept Russia's offer to extend the treaty without preconditions in order to avoid a new arms race and begin negotiations on a broader arms control agenda. What that would look like remains to be seen. "I don't think there's a consensus view," said Wolfsthal, who is now director of the Nuclear Crisis Group, a disarmament advocate. "I would tell the administration to do a full review of its nuclear policy. What are nuclear weapons for? When might they be used? How many do you need? And then once you determine that you can go ahead and pursue a potential negotiation." But after a president like Trump, who has pulled out of three arms control agreements — the Iran deal, the Intermediate-range Nuclear Forces Treaty with Russia and the multinational Open Skies Treaty — it's a pretty sure bet Biden would try to rebuild the arms control framework that he calls "integral to our national defense and — when it comes to nuclear weapons — to our self-preservation."
| | | VAX TO THE FUTURE — Does Pfizer's Covid vaccine mean we're on the road back to normal life? It's complicated. In the latest POLITICO Dispatch, health care reporters Sarah Owermohle and Dan Diamond explain why.
| | | DAKOTAS UNDER STRAIN — In the past month, occupancy of fully staffed intensive care unit beds for adults has increased in states with rapidly rising coronavirus hospitalization rates, according to HHS estimates. In North Dakota, about 93 percent of ICU beds were occupied as of Nov. 9. In South Dakota, nearly a quarter of all hospital beds were occupied by Covid-19 patients.
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| | | | ZOOMING INTO THE TRANSITION — The Four Square panel of Eugene Daniels, Tim Alberta, Laura Barrón-López and Ryan Lizza takes us through election night and the battle against unsubstantiated voter fraud claims, and look ahead to Biden's transition with Transition Playbook author Alex Thompson.
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| | | | | KEEP UP WITH THE GLOBAL HEALTH AGENDA: If nothing else, 2020 revealed how critical it is to keep up with the politics, policy, and people driving global health. How are governments working to improve the health of their citizens? What role are NGOs playing? Who is driving the agenda? Our Global Pulse newsletter connects leaders, policymakers, and advocates to the people, and politics impacting our global health. Join the conversation and subscribe today. | | | | | | | | | | | | | | THE ART OF THE MEMOIR — The first volume of Obama's presidential memoir is set for release Tuesday. The nearly 800-page book grapples with Obama's first four years in office, and also includes his take on Trump's ascent to power. The Nightly's Renuka Rayasam spoke with historian Craig Fehrman, who wrote Author in Chief — a book about presidential books — about the presidential memoir. This conversation has been edited. What do you think of Obama's memoir from the excerpts that you have seen? While he was president, he made it pretty clear that he didn't always enjoy the way Washington, D.C., covered what was happening in the capital. He was somebody who didn't really like soundbites. He didn't really like juicy nuggets and traditionally those sorts of nuggets are what sell presidential memoirs. It'll be interesting to see with this book, how many nuggets and how many little newsy details are in it. Or did he kind of purposely choose not to put those in there? I'm sure Obama hopes that both of his books will be read closely and read with literary appreciation. President Obama has the literary talent, for sure. But I do think that we have to admit he's facing a really big literary challenge, too. Which presidents have gotten this genre right? Besides Grant? I really like Calvin Coolidge's. In 1929 it was one of the biggest books in the country. Coolidge didn't spend too much time talking about policy disputes and policy debates, partly because he had a pretty quiet presidency. What he wrote about instead is the personal side of the presidency. What did it feel like to be president? He told the story of his son, who was a teenager and died while he was president. And it's really heartbreaking stuff to read even today, because Coolidge talks about how 'I was the most powerful person in the world. But I didn't have the power to save my own son dying right there in front of me.'" It's such a short book. But Coolidge's brevity allows him to really focus in on that kind of personal side. I looked at the typed scripts and the hand-written notes in his presidential library in Massachusetts. He was a great writer and he really worked on it himself. I think a good book can be written with a ghost writer. There's plenty of examples of this. Ronald Reagan's first book, which is not really well known anymore, is called Where's the Rest of Me? He worked on that with a ghost writer, and he worked really hard on it. That's a book that's really revealing, really funny. It captures Reagan's voice. Then when it came time to write his presidential memoir decades later, he didn't work very closely with his ghostwriter. The first book is much better. What can we expect from President Trump's memoir? If you go back and look at Crippled America , which is the last book he wrote in the build up to running for president, it's much less Trumpian than you would think. You could imagine a Ted Cruz type candidate having the same book come out under their name. It's a lot different than the Trump presidency, whether you agreed with it or not. What that says is that Trump was not very involved with Crippled America. It was a book that other people put together for him and a sort of a candidate by numbers kind of book. That's not always the way he's done books. Art of the Deal , I think, is still one of those revealing ways to understand him and how his mind works because he was really involved with that. If it is a book that he's very involved in and it captures his personality and his beliefs and his frustrations, it'll be much different than most presidential books just because it'll be a much more angry and partisan book. Trump has broken a lot of presidential traditions. Any idea whether he would break this one and just not write a presidential memoir? There's 5 to 15 million reasons why he won't break this tradition. Those reasons being dollar bills.
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