| | | | | |  | | 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 the reckoning — Regular MM readers will know we've written for weeks (or months?) that speculative investment bubbles born of the era of free money would wind up in pain in multiple places from crypto to SPACs to real estate. Well, here we are. And now, as ever, Washington policy makers have to maybe, kinda, sorta do something about it? In fact, they really don't. People who piled money into these assets really just have themselves to blame because it was always obvious that many would take huge hits. There is much more to play out here and investors will get hurt. And frankly they should. But the shakeout is still stirring up DC. Via our Kellie Mejdrich: "A wave of pandemic-era speculation in Bitcoin and new shell corporations known as SPACs is crashing, and Washington policymakers are scrambling to come to the rescue of investors. "After a year of letting markets run wild, lawmakers are calling for a crackdown amid concern that many small investors are about to be burned. The move for government intervention is increasingly bipartisan as markets gyrate, setting up a clash with business interests. "Senate Banking Chair Sherrod Brown (D-Ohio) urged the Biden administration's new bank cop to stop issuing licenses to financial firms at the heart of cryptocurrency trading. "Sen. John Neely Kennedy , a Louisiana Republican, is proposing the first bill to regulate SPACs … that have no commercial operations but promise investors they will buy other firms to form conglomerates. The House will hold a hearing on SPACs on Monday." GOOD FRIDAY MORNING — Happy weekend, all. 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 Altria: Moving beyond smoking. Altria's companies are leading the way in moving adult smokers away from cigarettes – by taking action to transition millions toward less harmful choices. We are investing in a diverse mix of businesses to broaden options beyond traditional, combustible cigarettes. See how we're moving. | | | | | | President Biden at 12:35 p.m. welcomes South Korean President Moon Jae-in and the pair hold a presser at 5 p.m. NEW ON THE PODS — Our Victoria Guida talking wages YANG GANG LOSES GRIP ON NYC MAYOR'S RACE — Our Sally Goldenberg, Janaki Chadha, and Danielle Muoio: "Andrew Yang's grip on the New York City mayor's race continued to loosen this week, as rival Eric Adams maintained a competitive presence in the polls and Yang's command of local issues was repeatedly called into question. "The former presidential candidate flubbed a question about homeless shelters during a candidate forum Thursday morning, one day after he exhibited a lack of understanding about MTA operations. Later on Thursday, he seemed stumped by the mention of a controversial law governing the discipline records of police and correction officers." BIDEN REACHES DEEP INTO ECONOMY ON CLIMATE — Our Lorraine Woellert: "President Joe Biden will direct agencies to mitigate the financial risk of climate change to homeowners, consumers, federal workers, businesses and the government itself in a sweeping executive order signed Thursday. "Extreme weather poses risks to supply chains, food and water, housing and energy, according to a two-page fact sheet on the order. National Economic Council Director Brian Deese called the measure a pivotal moment for the U.S. government. 'Our modern financial system was built on the assumption that the climate was stable,' Deese told reporters. 'It's clear we no longer live in such a world.'" | | | | SUBSCRIBE TO WEST WING PLAYBOOK: Add West Wing Playbook to keep up with the power players, latest policy developments and intriguing whispers percolating inside the West Wing and across the highest levels of the Cabinet. For buzzy nuggets and details you won't find anywhere else, subscribe today. | | | | | | | | WALL STREET BREAKS 3-DAY LOSING STREAK — Reuters' Medha Singh and Shashank Nayar: "Wall Street's main indexes rebounded after a three-day slide on Thursday, helped by gains in technology stocks, as the smallest weekly jobless claims since the start of a pandemic-driven recession lifted the mood. "Bitcoin regained some lost ground to trade near $40,000, a day after a brutal selloff, helping renew appetite for risk. Crypto-exchange operator Coinbase Global, miners Riot Blockchain and Marathon Digital Holdings rebounded between 1.6 percent and 5.1 percent." FED TO PUBLISH PAPER ON DIGITAL CURRENCY THIS SUMMER — WSJ's Paul Kiernan: "The Federal Reserve said Thursday it plans to publish a discussion paper on the potential benefits and risks of issuing a U.S. digital currency, as central banks around the world experiment with the potential new form of money. "'The paper represents the beginning of what will be a thoughtful and deliberative process,' Fed Chairman Jerome Powell said in a video message Thursday. He added that the Fed hasn't come to a conclusion on whether it will move forward with a digital currency but intends to seek public comment on the matter." | | | |   | | | | | | BIDEN'S IRS PLAN WOULD DOUBLE AGENCY STAFFING, TARGET CRYPTO — WSJ's Richard Rubin: "The Biden administration's tax enforcement plan would double the number of IRS employees over the next decade and require banks, payment services and cryptocurrency exchanges to provide the government more information about account flows, according to a Treasury Department report released Thursday. "Treasury officials project that the plan would generate a net $700 billion over the next 10 years and $1.6 trillion in the decade after that, and the report says those figures are conservative because they underestimate how audits deter tax dodging and don't count any benefits from improving IRS technology." JOBLESS CLAIMS FALL AGAIN — AP's Christopher Rugaber: "Fewer Americans sought unemployment benefits last week — the latest encouraging sign for the rebounding U.S. economy — just as Republican-led states are moving to cut off a federal benefit for the jobless. "Twenty-two states, from Texas and Georgia to Ohio and Iowa, plan to begin blocking a $300-a-week federal payment for the unemployed starting in June, according to an Associated Press analysis. Recipients have been able to receive the $300 federal benefit on top of their regular state unemployment aid. The payment, which lasts nationwide until Sept. 6, was included in President Joe Biden's $1.9 trillion financial rescue package." AS PPP RUNS DRY, DESPERATION GROWS — NYT's Stacy Cowley: "The government's $788 billion relief effort for small businesses ravaged by the coronavirus pandemic, the Paycheck Protection Program, is ending as it began, with the initiative's final days mired in chaos and confusion. "Millions of applicants are seeking money from the scant handful of lenders still making the government-backed loans. Hundreds of thousands of people are stuck in limbo, waiting to find out if their approved loans — some of which have been stalled for months because of errors or glitches — will be funded. Lenders are overwhelmed, and borrowers are panicking." | | | | SUBSCRIBE TO "THE RECAST" TODAY: Power is shifting in Washington and in communities across the country. More people are demanding a seat at the table, insisting that politics is personal and not all policy is equitable. The Recast is a twice-weekly newsletter that explores the changing power dynamics in Washington and breaks down how race and identity are recasting politics and policy in America. Get fresh insights, scoops and dispatches on this crucial intersection from across the country and hear critical new voices that challenge business as usual. Don't miss out, SUBSCRIBE . Thank you to our sponsor, Intel. | | | | | HIGH INFLATION? A GENERATION OF INVESTORS HAS NEVER FELT IT — AP's Stan Choe: "The central question gripping Wall Street is whether the burst of inflation hitting the economy as it recovers from the pandemic is just temporary or the start of a real problem. "The answer threatens to crack the stock market's incredible, record-setting run that began in March 2020. Adding to the fog of the debate — and the uncertainty that has markets churning — is that more than a generation has passed on Wall Street since investors had any experience at all with high, long-lasting inflation." JPMORGAN TACKLES HEALTHCARE. AGAIN. — Reuters: "JPMorgan Chase & Co said on Thursday it launched a unit aimed at improving health care for its U.S. employees, months after its similar joint venture with Amazon.com Inc and Berkshire Hathaway Inc was disbanded. "The unit, Morgan Health, will initially invest up to $250 million and work with the JPMorgan Chase's benefits team to collaborate with other healthcare organizations to improve care for its staff in the United States. It will be headquartered in Washington, D.C." MORGAN STANLEY BUCKS BANK DIVERSITY TREND — Bloomberg's Max Abelson and Sonali Basak: "After years of talking about the need for more equality on Wall Street, two of the biggest banks just previewed what the finance industry's next generation of leaders will look like. At Morgan Stanley, they'll resemble the old guard. "Chief Executive Officer James Gorman unveiled his biggest leadership change in over a decade, positioning a slate of potential successors that's mostly White and male — just as Wall Street's bosses have been for decades. The group includes trading architect Ted Pick and wealth-management leader Andy Saperstein, plus investment management's Dan Simkowitz and new Chief Operating Officer Jon Pruzan." | | | | A message from Altria: Moving beyond smoking. Altria's companies are leading the way in moving adult smokers away from cigarettes. Today, we are taking action to transition millions toward less harmful choices.
From cigarettes to innovative alternatives. By investing in a diverse mix of businesses, Altria is working to further broaden options. Our companies are encouraging adult smokers to transition to a range of choices that go beyond traditional, combustible cigarettes.
From tobacco company to tobacco harm reduction company. And while Altria is moving forward to reduce harm, we are not moving alone. We are working closely with FDA and other regulatory bodies, and will work strictly under their framework.
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