| | | | | |  | | By Ben White and Aubree Eliza Weaver | Presented by |  | | | Editor's Note: Morning Money is a free version of POLITICO Pro Financial Services' morning newsletter, which is delivered to our subscribers each morning at 6 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day's biggest stories. Act on the news with POLITICO Pro. | | | Welcome to jobs day! — A brief return to normalcy following days of political chaos. We get to focus for a moment back on the economy that President-elect Joe Biden will inherit on Jan. 20 with the December jobs report at 8:30 a.m.. And it's not moving in the right direction as Covid-19 continues to rage, the vaccine distribution process crawls and long-delayed fiscal stimulus has yet to hit the system. Oh and Washington remains consumed by Wednesday's seditious attack on the Capitol and talk of immediately removing outgoing President Donald Trump either through the impeachment process or the 25th amendment, neither of which are going to happen (more below). Moody's Mark Zandi emails : "December employment will decline by 50,000 jobs and the unemployment rate will rise to 6.8% from 6.7%. The economy will still be down 10 million jobs from its pre-pandemic peak. Employment has declined during the Trump presidency. "The December loss of jobs is due to the re-intensification of the pandemic and the inability of lawmakers to come to terms on additional fiscal relief until late in the month. Retailers, restaurants, recreational activities, personal services, and the leisure and hospitality industry have been forced to pull-back on hiring and layoff more workers as COVID infections," S&P Global's Beth Ann Bovino: "We expect the unemployment rate to tick higher from 6.7% to 6.8% as the quarantine measures, either mandated or self-imposed, lead to more people that are unemployed. We are expecting December job gains to be in positive territory, but at 50,000 for the month, it's a far cry from the million-plus job gains posted through the summer. "We expect to regain 5.7 million jobs in 2021. With over 10 million jobs still lost, it will take at least 2 years before the 22 million jobs lost from COVID-19 are regained." Pantheon's Ian Shepherdson: "Whether today's December payroll numbers are as bad as ADP's 123K drop or rather better—as we expect— is not the real story. The loss of momentum in the labor market is very clear, and it will continue until Covid restrictions can be eased meaningfully. "Depending on the pace of vaccinations and the speed of the decline in cases—right now, they're still rising, but will peak very soon—that likely means late February or March at the soonest. That, in turn, suggests no real improvement in the labor market until April." GOOD FRIDAY MORNING — What a brutal exhausting week. Enjoy the NFL playoffs this weekend. #HTTFT. Email me on bwhite@politico.com and follow me on Twitter @morningmoneyben. Email Aubree Eliza Weaver on aweaver@politico.com and follow her on Twitter @AubreeEWeaver. | | A message from Blackstone: Blackstone partners with businesses through tough times: Amid periods of economic uncertainty and difficult market conditions, Blackstone consistently supports the companies in which we invest to help position them for long-term growth. | | | | | | December jobs report at 8:30 a.m. expected to show a gain of just 50K with unemployment rising to 6.8% from 6.7% and wages up 0.2%. MNUCHIN TALKED ABOUT 25th AMENDMENT — CNBC's Kayla Tausche: "As President Donald Trump stood idly by with violent protestors ransacking the U.S. Capitol on Wednesday, at least two of his top officials and closest allies conferred with staff about the possibility of invoking the 25th Amendment. "Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin held informal conversations within their own agencies about the contours of the 25th Amendment, the invocation of which would begin a process to remove Trump from office, according to three sources" MM SIDEBAR — Regardless of what informal chats took place, there is very little chance Trump's remaining Senate-confirmed cabinet secretaries would go this route. There simply isn't time. Trump could reject it, sending it Congress where it would almost certainly die. Same goes for impeachment. The House could theoretically do it as a political exercise. But there's no time for a Senate trial or enough support for removal. Either move would also likely further inflame Trump's diehard supporters and risk further violence. All this could change it Trump resumes inciting violence. But if he doesn't, and spends his final 12 days in office laying low and pardoning people (including possibly himself), most administration officials simply want to watch the clock run out. DeVoS RESIGNS — Our Nicole Gaudiano and Michael Stratford: "Education Secretary Betsy DeVos submitted her resignation letter Thursday, two department officials confirmed to POLITICO. "DeVos, one of a half-dozen members of … Trump's Cabinet who has lasted for the duration of his term, cited Trump's rhetoric surrounding the Capitol riots as an 'inflection point' for her." | | | | GET THE BIG PRE-INAUGURATION SCOOPS IN TRANSITION PLAYBOOK: Inauguration Day is quickly approaching. Is the Biden administration ready? Transition Playbook brings you inside the transition and newly forming administration, tracking the latest from Biden world and the transition of power. Written for political insiders, this scoop-filled newsletter breaks big news and analyzes the appointments, people and emerging power centers of the new administration. Track the transition and the first 100 days of the incoming Biden administration. Subscribe today. | | | | | HOW PEOPLE PLAN TO SPEND STIMULUS CHECKS — Via Morning Consult survey of 2,200 adults on the $600 stimulus checks: "Consumers across the income spectrum indicated that they were most likely to save their stimulus checks. 60% of high-income respondents indicated an intent to save their checks compared to 45% and 33% of middle- and low-income respondents, respectively. "Low-income respondents are more likely to say they plan to spend their stimulus checks on rent, debt repayments and food than the other two groups. 30% of low-income respondents indicated an intent to buy food using their stimulus checks, compared to 20% of middle- and high-income respondents." RAIMONDO FOR COMMERCE — Our Tyler Pager, Doug Palmer and Gavin Bade: "Biden has selected Rhode Island Gov. Gina Raimondo to serve as secretary of Commerce, … Biden has also tapped longtime aide Don Graves as deputy Commerce secretary and California official Isabel Guzman to lead the Small Business Administration, a source familiar with the matter said. "Raimondo, who impressed the Biden team when she was considered to be Biden's running mate, was also in contention to run the Treasury Department and the Department of Health and Human Services." WALSH FOR LABOR — Our Eleanor Mueller and Tyler Pager: "Biden has picked Boston Mayor Marty Walsh, a former top union leader, to serve as his Labor secretary … ending a selection process that split the labor movement and stoked diversity concerns among Democrats. "Walsh beat out a host of other names floated for the position, including Rep. Andy Levin (D-Mich.), former Deputy Labor Secretary Seth Harris, California Labor Secretary Julie Su and AFL-CIO Chief Economist Bill Spriggs. His selection suggests that Biden was willing to overlook calls for a more diverse choice, since Walsh is a white man, and Asian American and Pacific Islanders had been lobbying heavily for Su. Spriggs is Black." SBA TO PRIORITIZE MINORITY-OWEN BUSINESSES — Our Zachary Warmbrodt: "The Small Business Administration will give priority to minority-owned businesses that have struggled to obtain coronavirus aid when the agency relaunches its Paycheck Protection Program, according to newly released rules and guidelines. "The SBA and the Treasury Department … published guidance for how they will implement the next round of PPP loans, which Congress overhauled in the Covid-19 relief plan that became law last month. The program, which has $285 billion in new funding, allows businesses to convert the loans into grants if they agree to maintain payroll." | | | |   | | | | | | WALL STREET KEEPS RISING ON DEMOCRATIC WINS — AP's Stan Choe and Alex Veiga: "Major U.S. stock indexes surged to all-time highs Thursday as Wall Street bet that the Democratic sweep of Washington means more stimulus is on the way for the economy. "The S&P 500 rose 1.5 percent to a record high in the first day of trading after Congress confirmed Joe Biden as the winner of the presidential election and Jon Ossoff was declared the winner of a Georgia runoff election, tipping control of the Senate to Democrats. The Dow Jones Industrial Average, Nasdaq composite and Russell 2000 index of smaller companies also notched new highs." TRADERS REFLECT ON CAPITOL RIOT, AFTERMATH — Bloomberg's Max Abelson, Hannah Levitt and Kelsey Butler: "Across Wall Street, executives watched in horror from home desks and mostly empty offices as a mob of President Donald Trump's supporters ransacked the U.S. Capitol on Wednesday. "Then something changed. The market, inured to years of political chaos, mostly shrugged off one of the most brazen attacks ever on American democracy. By Thursday, much of the financial world was practically back to business as usual." | | A message from Blackstone: Blackstone adds long-term value to our companies: We're committed to partnering with the companies in which we invest—through good times and bad—to help strengthen their long-term performance. Building resilient businesses goes beyond just driving better investment returns: it can also contribute to inclusive economic growth that creates great jobs and uplifts communities. And by supporting emerging businesses in fast-growing sectors ranging from logistics to life sciences, we can help accelerate solutions to meet the unique challenges of the moment.
Our long-term approach is what has helped us deliver on behalf of our investors—which include more than 31 million U.S. pensioners—over our more than 35-year history. See how our bottom line goes beyond returns. | | | | | | LABOR MARKET RECOVERY FALTERING — Reuters' Lucia Mutikani: "The number of Americans filing first-time claims for jobless benefits unexpectedly dipped last week while staying extremely high, with the labor market recovery appearing to stall as a raging COVID-19 pandemic threatens to overwhelm the country. "Layoffs announced by U.S. companies surged 18.9 percent in December, other data on Thursday showed. Though services industry activity accelerated last month, employment fell. The reports followed on the heels of news on Wednesday that private companies shed workers in December, heightening the risk that the economy lost jobs last month for the first time since April." FOR BANKERS, 2020 WAS A BAD YEAR TO HAVE A GOOD YEAR — WSJ's Simon Clark and Margot Patrick: "Wall Street banks have had a decent crisis so far. That is unlikely to translate to bumper bonus payments for bankers and traders, as chief executives and boards grapple with the optics of big payouts amid economic hardship on Main Street. "At Bank of America Corp. the bonus pool is likely to be flat, according to people familiar with the bank's plans. Bonuses for some JPMorgan Chase & Co. traders are expected to rise, according to a person familiar with the situation, but not as much as the 39 percent increase in trading revenues at the New York-based bank in the first nine months of 2020. " BULLARD: LOOSE FED, POST-PANDEMIC BOOM COULD SET STAGE FOR HIGHER INFLATION — Reuters: "The combination of easy monetary policy, ample government spending, and a possible economic surge once the pandemic lifts could spark faster-than-expected inflation, St. Louis Federal Reserve President James Bullard said" FEDERAL INVESTIGATORS PROBING AMEX CARD SALE PRACTICES — WSJ's AnnaMaria Andriotis: "Federal investigators are probing business-card sales practices at American Express Co., according to people familiar with the matter. "The inspectors general offices of the Treasury Department, Federal Deposit Insurance Corp. and Federal Reserve are investigating whether AmEx used aggressive and misleading sales tactics to sell cards to business owners and whether customers were harmed, the people said. They are also examining whether specific employees contributed to the alleged behavior and if higher-level employees supported it, some of the people said." LOOKING AHEAD — Nasdaq chief economist Phil Mackintosh with a look at what to expect in 2021. | | | | A NEW YEAR MEANS A NEW HUDDLE IS HERE: Huddle, our daily congressional must-read, has a new author! Olivia Beavers took the reins this week, and she has the latest news and whispers from the Speakers' Lobby. Don't miss out, subscribe to our Huddle newsletter, the essential guide to all things Capitol Hill. Subscribe today. | | | | | | | | | Follow us on Twitter | | | | Follow us | | | | |
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