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Wednesday: Beige Book, Homebuilder Confidence, Tar and Feathers

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Note: The action in the House today was a side show for political purposes only. The real action is in the Senate, and I expect an agreement to be reached soon.

From the NY Times: Conservatives and Moderates Close to Open Revolt

On the brink of a historic default, House Republicans on Tuesday put off a vote on their latest proposal to reopen the government and raise the debt limit, as a major credit agency warned that the United States was on the verge of a costly ratings downgrade.

Hard-line conservatives and more pragmatic Republicans were nearing open revolt Tuesday evening, after House Republican leadership rushed out a new bill in the afternoon, forcing a postponement of any vote on the measure. With the latest delay, chances increased that a resolution would not be reached before the Treasury exhausted its borrowing authority on Thursday.

“It’s very, very serious,” said Senator John McCain, Republican of Arizona. “Republicans have to understand we have lost this battle, as I predicted weeks ago, that we would not be able to win because we were demanding something that was not achievable.”

In addition to the highest unfavorable ratings in history, now tar and feathers are selling out in Republican congressional districts!1

Wednesday:
• 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index. Look for the government shutdown to impact applications.

• DELAYED: At 8:30 AM, the Consumer Price Index for September was scheduled for release. The consensus is for a 0.2% increase in CPI in September and for core CPI to increase 0.2%.

• At 10:00 AM, the October NAHB homebuilder survey. The consensus is for a reading of 57, down from 58 in September. Any number above 50 indicates that more builders view sales conditions as good than poor.

• At 2:00 PM, the Federal Reserve Beige Book, an informal review by the Federal Reserve Banks of current economic conditions in their Districts.

1“Tar and feathers” is a joke, but not the record high unfavorable ratings for Republicans.
Calculated Risk

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