| | | | | |  | | 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. | | | Sperling for stimulus czar — Via Laura Barrón-López and me with Chris Cadelago and Natasha Korecki: President Joe Biden is eyeing Gene Sperling for a role to oversee the implementation of the administration's coronavirus relief plan, according to two sources with knowledge of the plans. The White House could announce the role for Sperling as early as Monday, the sources said. Sperling, who served on the economic teams in both the Obama and Clinton administrations, was under consideration to serve as Biden's director of the Office of Management and Budget after the president's first pick, Neera Tanden, failed to secure enough support in the Senate. Instead of that post , he is being strongly considered for a position within the White House where he will be tasked with overseeing the enactment of the recently signed $1.9 trillion Covid relief bill. … Sperling declined to comment. The White House also declined to comment. Sperling, who currently lives in Los Angeles with his family, would bring a wealth of experience on economic policy issues to the stimulus czar position. He served as head of the National Economic Council under both Clinton and Obama as well as a top adviser at the Treasury Department under Obama. A fixture in the Washington policy wonk set for decades — famous for shambling around to meetings with a phone tucked behind his ear and piles of papers in his hands — Sperling has deep relationships across Capitol Hill. He had been looking for a significant role in the Biden administration. And the White House had indicated to lawmakers that it wanted him in the top slot at OMB. Young for OMB — Shalanda Young is increasingly likely to be Biden's final pick to lead OMB, according to four sources familiar with White House discussions. Young, who is currently Biden's nominee to be deputy budget director, is a longtime congressional budget aide and has received the backing of the Congressional Black Caucus, the top three Democratic leaders in the House, members of the Hispanic Caucus, and some Republicans. GOOD MONDAY MORNING — Welcome to another week when March will turn on us and put is the deep freeze again. 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 the American Bankers Association: More than 3,000 bank leaders from around the nation will virtually converge on Washington this week for the industry's largest annual policy discussion. At ABA's virtual Washington Summit, ABA President and CEO Rob Nichols will outline our Blueprint for Growth and detail the latest industry efforts to work with the Biden administration and the new Congress to defeat COVID-19 and strengthen the recovery. Read the Blueprint. | | | | | | Biden delivers remarks on the implementation of the American Rescue Plan at 1:45 p.m. (which could include the Sperling news) … Also this week: FOMC meets with latest announcement at 2:00 p.m. Wednesday followed by Jay Powell presser. No change in policy expected and Powell will also likely continue to push back on the idea that inflation is an imminent risk … House Financial Services has a hearing Wednesday at 10am on "Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide, Part II." … Biden heads on the road to tout the stimulus on Tuesday in Delaware County, Pennsylvania … On Wednesday, Biden will host H.E. Micheál Martin, Prime Minister of Ireland, for a virtual bilateral meeting … Biden and VP Kamala Harris head to Georgia on Friday to tout the stimulus … FED PREP — Via Compass Point's Isaac Boltansky: "While the statement is unlikely to show a seismic shift in thinking, our sense is that the FOMC's projections could show some improvement in the economic outlook as well as some modest movement on the dot plot. During the 2:30pm press conference, however, we expect … Powell to largely reiterate the comments from his most recent interview." Via Goldman Sachs: "Front-end pricing has turned hawkish and longer-term rates have risen sharply since the FOMC last met. While many investors will watch closely next week for any pushback from … Powell, we think they will be disappointed. "Fed officials are unlikely to see much of a problem at a time when financial conditions remain easy, activity is picking up, and powerful growth impulses are set to support the economy all year. Powell could reiterate and clarify the scattered hints that Fed officials have provided about the taper timeline." YELLEN: DON'T SWEAT INFLATION — Our David Cohen: "Treasury Secretary Janet Yellen on Sunday defended the recently enacted Covid relief package, saying the benefits for the economy far outweigh any concerns that the burst of government spending could lead to inflation. Speaking on ABC's 'This Week,' Yellen said, 'We need to defeat the pandemic. This package really does that.' … "Yellen said the greater risk was in not bolstering the economy — saying the federal government needed to assist people who are out of work, who are facing eviction or foreclosure, or who simply don't have enough food to eat." TRUMP GREASED WHEELS FOR SPENDING SPREE — Our Victoria Guida: "Republicans are bashing the new $1.9 trillion pandemic relief package for further ballooning the federal debt, but it's the Trump administration that greased the path for a smooth federal spending spree. "The Treasury has a cash pile of well over $1 trillion, which will allow the government to quickly disburse money in line with the sweeping new law, including direct checks to millions of Americans that are expected to start hitting bank accounts in the coming week. That robust rainy-day fund was built last year by then-Treasury Secretary Steven Mnuchin, who preemptively cranked up the pace of government borrowing, unsure of how and when Congress might mandate further relief measures." ONE YEAR LATER — Mohamed A. El-Erian on Bloomberg Opinion: "A year has passed since the U.S. economy was the victim of a dramatic sudden stop at the hands of the Covid-19 virus. What has transpired since, especially when compared with early consensus expectations, tells us a lot about both the inherent strength of the economy and its Achilles' heel." DEMS WANT TO MAKE NEW BENEFITS PERMANENT — Our Megan Cassella: "Nearly $2 trillion in fresh relief benefits are expected to start flowing into Americans' bank accounts within days. Now, Democrats are already looking to make some of them permanent. "With … Biden's American Rescue Plan signed into law, Democratic lawmakers are exploring ways to ensure that generous tax credits and other key aspects of the legislation will last well beyond the pandemic itself, either through additional rounds of extensions or more permanent measures." | | | | A message from the American Bankers Association:   | | | | | | FOR WALL STREET, EVERYONE'S A POST-COVID WINNER — WSJ's Justin Lahart: "The trend line on jigsaw puzzles and dried beans is looking bullish, so just wait until the pandemic is over! Of course that is a ridiculous conceit, but it is also one that to some degree is playing out on Wall Street, where analysts are predicting companies that saw their sales jump during the Covid-19 crisis will keep doing better." SHORT SELLERS BOOST BETS AGAINST SPACS — WSJ's Matt Wirz and Juliet Chung: "Short sellers are coming for SPACs. Investors who bet against stocks are targeting special-purpose acquisition companies, one of the hottest growth areas on Wall Street. The dollar value of bearish bets against shares of SPACs has more than tripled to about $2.7 billion from $724 million at the start of the year, according to data from S3 Partners." | | | | JOIN THE CONVERSATION, SUBSCRIBE TO "THE RECAST": Power dynamics are shifting in Washington, and more people are demanding a seat at the table, insisting that all politics is personal and not all policy is equitable. "The Recast" is a new twice-weekly newsletter that breaks down how race and identity are recasting politics, policy and power in America. Get fresh insights, scoops and dispatches on this crucial intersection from across the country, and hear from new voices that challenge business as usual. Don't miss out on this new newsletter, SUBSCRIBE NOW. Thank you to our sponsor, Intel. | | | | | | | | FED TO HIKE RATES IN 2023, BUT DOTS WON'T SHOW IT — Bloomberg's Steve Matthews and Kyungjin Yoo: "A strong recovery from the Covid-19 recession is likely to prompt … Powell and his colleagues to lift interest rates in 2023, but that isn't going to show up in their forecasts this week, a survey showed. "Economists surveyed by Bloomberg News see two quarter-point hikes in 2023. But they also expect the U.S. central bank's own forecast, released at the same time as its policy statement at 2 p.m. in Washington on Wednesday, will show the median Fed official projecting rates staying on hold near zero throughout that year." TURBOCHARGED ECONOMY LEAVES FACTORIES STRUGGLING TO DELIVER GOODS — WSJ's Paul Hannon, Bob Tita and Eun-Young Jeong: "Successful vaccination campaigns in the U.S., accumulated savings and the $1.9-trillion relief bill are turbocharging consumer demand. "That is straining the globe-spanning supply chains companies rely on to deliver everything from toys to cars. For now, economists don't expect the shortages to be a big drag on the recovery. But some businesses worry that a further surge in demand, led by the U.S., could exacerbate supply-chain disruptions and drive up costs." 17 REASONS TO LET THE ECONOMIC OPTIMISM BEGIN — NYT's Neil Irwin: "Those two decades coincide almost precisely with my career as an economics writer. It is the reason, among my colleagues, I have a reputation for writing stories that run the gamut from ominous to gloomy to terrifying. But strange as it may seem in this time of pandemic, I'm starting to get optimistic." | | A message from the American Bankers Association: It's a critical time for our country's economy, and the success of America's recovery effort depends on a healthy banking system. As the new administration and 117th Congress take new steps to strengthen the government's response to the pandemic, America's banks will continue to serve as a source of strength for the economy. This week, more than 3,000 bank leaders will virtually gather for ABA's Washington Summit and join with top lawmakers, regulators and administration officials to discuss the major policy issues directly affecting banks and the people and places they serve.
To see our ideas for jumpstarting the recovery and growing a more inclusive economy, read our Blueprint for Growth. | | | | | | TRANSITIONS — Via Axios: "Lily Adams, a veteran of Vice President Kamala Harris' presidential bid, is joining the Treasury Department to help promote the $1.9 trillion American Rescue Plan and the administration's broader plans to combat income inequality." … The Financial Technology Association, a new trade association launched this week as the fintech industry beefs up its presence in Washington, has hired Tiger Hill's Milan Dalal , a former staff director for Senate Banking subcommittees and a senior economic adviser to Sen. Mark Warner (D-Va.) to lobby on its behalf. NEW FROM DELOITTE — Deloitte has a new paper out today on "A Higher Bottom Line: The Future of Financial Services." | | | | HAPPENING THURSDAY - PLAYBOOK INTERVIEW WITH CONGRESSMAN LEE ZELDIN : The GOP has not won a statewide election in New York in nearly two decades. Rep. Lee Zeldin (R-N.Y.), an ally of former President Donald Trump, is one of several Republicans considering a challenge against embattled New York Gov. Andrew Cuomo. Join Playbook co-authors Tara Palmeri and Ryan Lizza for a conversation with Rep. Zeldin to discuss a potential gubernatorial run and how he is working with Democrats in Congress. REGISTER HERE. | | | | | | | | | Follow us on Twitter | | | | Follow us | | | | |
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