… and all through the collocated server house, GETCO algos were stirring, hoping (as this is the only “strategy” left) that maybe, just maybe, Obama can pull a unicorn out of his skittles-dispensing hat. He won’t, and most likely we will get one last does of stern fingerpointing, harsh language and accusative condemnation of those wascaly wepublicans. But find out for yourselves in 15 short minutes, when the market may be closed, but futures will still be open, although at least subject to the limit down rule. Of course, if the news was good, it would have come before 4 pm…
In all seriousness, what Obama will discuss is a last ditch extension, one which merely kicks the can by a week or two. From Politico:
Obama’s $2.4 trillion proposal is still on the table — and it remains his preference. But administration officials said Friday that it would be difficult to pass unless House Speaker John Boehner (R-Ohio) decides to rejoin the talks. And he has given no indication that he will.
So the White House is looking at one option under consideration by the Senate Democratic leadership: a smaller package that would extend the Bush-era tax rates on income below $250,000, pause the across-the-board spending cuts known as the sequester and renew unemployment insurance benefits, according to Senate and administration officials.
It would hold off a significant portion of the fiscal cliff, minimizing any economic shock in the new year. But it means a host of tax provisions would likely expire, little would be done to address the debt and deficit, and no process would be set up for overhauling the tax code next year. There would be no agreement on entitlements, and no resolution on raising the debt ceiling.
Faced with few good options and a shrinking timeline, Democrats are trying to put the squeeze on Boehner after he failed Thursday to come up with enough votes for his bill extending tax breaks on income below $1 million.
Dropping the income threshold to $250,000 would be a complete capitulation for Boehner, and the math for getting the votes is tough.
But the White House assumes that, if the Senate passes a bill, an isolated House Republican majority will feel pressured to act, similar to the way the 2011 payroll tax cut fight and debt limit showdown played out.