Epstein and Budgets

Recently Washington has seen an explosion of activities surrounding the saga of Jeffrey Epstein. As momentum shifted and House passage of a resolution calling for the Department of Justice to release all Epstein files gained steam, Republicans in Congress and the White House changed strategy and backed the Congressional Resolution.

The House voted with only one NO vote, the Senate passed the bill without a roll call vote under a procedure known as Unanimous Consent, and the passed bill was quickly signed by the president. The legislation gives the Department of Justice 30 days to release the files.

As Tom Lee has pointed out, some important market participants may see their names as files are released.  Former Treasury Secretary and Harvard President Larry Summers has already been caught in the Epstein net, and as a result, he has been forced to stop teaching and bow out of public life.

Thus, a question that could arise in coming weeks is how markets might react if important financial leaders get caught up in the upcoming disclosures.

In other news, Congress has left town and is not scheduled to return until Dec. 2. This would give them only a few weeks to act on the healthcare issue of the ACA/Obamacare subsidies that are part of the healthcare system and expire on Dec. 31.  The Continuing Resolution (CR) that opened the government provided that the Senate would hold a vote on the issue before yearend.  With Congress set to leave town again for Christmas break on Dec. 22, this gives Congress only 20 days to deal with the issue.

Additionally, the Congress must move the nine large spending bills through Congress by the new shutdown deadline of Jan. 30, and the White House continues to create headlines with its policy of going after drug smugglers and pushing for a faceoff with the leader of Venezuela.

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