About two weeks ago, the majority leader in the US Senate, indicated that the deadline for the approval of the new $1.9 trillion stimulus package should occur in mid-March, a horizon that did not please investors who were counting on this injection. Earlier liquidity, which justified a correction in the North American indices. However, that month and a half that Chuck Schumer mentioned included the attempt to reconcile the two sides of the barricade, an idea defended by Joe Biden who wanted a project with the maximum possible support, not least because this is part of the strategy of the new president to foster a time of political appeasement after Trump’s mandate, where the strategy was the other way around.
And Biden tried to keep that promise, meeting on Monday with ten senators who are members of the Republican party to discuss the group’s intention in a much smaller package that does not reach $700 billion. The president argued that the amount would not be enough to achieve the objectives proposed, that is, dealing with a pandemic that has already caused the death of 440,000 Americans and left the largest economy with a huge hole to be filled in terms of employment. Whether the meeting was just a show-off operation for both parties is unknown, but at the end of the day it became clear that the distance of arguments is such that they would hardly reach an understanding.
That is why the Democrats, both in the Senate and in the House of Representatives, started a process called reconciliation, an exceptional expedient that allows to accelerate the approval of the package without the need for the Republicans to vote, passing the diploma with a simple majority, unlike the 60% required for most laws. It was this anticipation of the deadline that gave the necessary breath for the sentiment to have improved substantially, a breath of fresh air that the Bulls took advantage of pushing Wall Street for a day of interesting gains, now it remains to be seen whether, when the actual approval will take place validation of the motto, “buy in the rumour and sell in the news”.
