The House that Joe Built

Hey Influence Traders,


I hope that everyone is having a wonderful weekend.


Getting last minute shopping done to fill the tree and fuel the economy!


I watched the Nutcracker four times in the past couple days.


My daughter is in the show.


She’s a true headliner.


Speaking of headlines, there’s one Joe making them in DC these days.


And it isn’t the President.


Sen. Joe Manchin of West Virginia is causing ripples throughout the government.


Driving the Agenda


President Biden and Senate Majority Leader Chuck Schumer have been pushing hard to get the Build Back Betterbill passed before the Christmas break.


On Sunday, Joe Manchin said “this is a no” when asked if he would be voting this week for the bill.


Manchin is worried (rightfully) about the impact of the bill on the already rising inflation.


For example, it was announced today that lumber prices are again going through the roof because of flood related supply chain disruptions in British Columbia. That could bode well for Home Depot (Ticker: HD) and Lowe’s (Ticker: LOW).


The White House immediately accused Manchin of “going back on his word.”


Manchin essentially accused the White House of lying (but more politely).


The progressive wing of the party went bonkers.


Bernie Sanders said, “I think he’s gonna have a lot of explaining to do to the people of West Virginia.”


Sanders conveniently ignored that a strong majority of polled West Virginians support Manchin’s position.


What Next


Manchin’s declaration effectively pushes consideration of the bill until after Christmas.


But some on the Hill are more pessimistic, worrying that the bill is on the verge of “collapse."


One of the issues is that Manchin wants the child tax credit to be extended (which will happen anyway) to reflect the true cost of the bill.


Dem leadership does not like that idea because it will double the cost of the bill over 10 years.


The CBO score was already “an eye-opener” for many on the Hill.


Broad Impact


Biden’s agenda had a massive end-of-year sell-off.


Almost as bad as the crypto sell-off taking place.


Overexuberance this past year coupled with negative interest on the Hill is not boding well for digital assets going into 2022.


Bitcoin (Ticker: BTC) and Ethereum (Ticker: ETH) are predicted to shed a lot of their 2021 gains in the coming months.


I’m going to follow the lead of Power Income guru Bill Griffo and look more closely at gold to hedge inflation.


Tracking more like stocks than commodities, crypto does not appear to be the gold replacing inflation hedge the enthusiasts hoped for.


Crypto relies on new trading volume and its down significantly … not a good sign


Dem leadership did not provide any clear timeline for when the more than 2,000-page bill might eventually come to the floor. 


That does not bode well for the Biden agenda moving into an election cycle.


Polling will now begin to drive agendas.


And in fighting will increase.


Progressives are not happy.


They’ve had both houses on the Hill and the White House and thought they were going to drive a transformative agenda.


That has not happened.


And that realization has hit some in the party’s left flank particularly hard.


With the midterms approaching and a chance of losing one or both chambers, anticipate a hard push by progressives to force change going into the new year.


Happy Holidays!

Cutting through the noise for you,

Frank

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