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No Deal

After the markets had closed last Friday, reports surfaced that House Speaker John Boehner went to the White House for a special meeting with president Obama.  Would a “fiscal cliff” deal be reached as Congress left for its Christmas break?

Over the weekend Congressional aides told reporters of the weekend meetings and what was said.  Mr. Boehner once again inched closer to what president Obama wants – tax hikes on the wealthy – but the president refused the deal.  Specifically, Boehner offered to raise income tax rates on households earning more than $1 million a year in exchange for spending cuts.

Dec 15 (Reuters) - U.S. House Speaker John Boehner has offered to raise tax rates on high earners to break the "fiscal cliff" deadlock in exchange for major cuts in entitlement programs, but President Barack Obama is not ready to accept, a source said late Saturday.
While the White House considers Boehner's offer "progress," the source said more remained to be worked out between the two.
The president refused the proposal because he wants tax hikes on anyone making more than $250,000 per year, but he also does not want to cut spending.

And this may be what John Boehner wanted from the meeting: proof that the president is not willing to make a deal.  Now the Speaker will use this as evidence that he shouldn’t be blamed when both sides drive us over the cliff.
The pending Thelma & Louise moment, however, is just what both sides want.  After all, they can blame each other forever over this issue and at the same time brag about how they cut taxes after they raised taxes via the fiscal cliff ramifications.  It’s pathetic, but that’s politics.
Trade well and follow the trend, not the perma-bull OR perma-bear “experts.”

Behold the age of infinite moral hazard! On April 2nd, 2009 CONgress forced FASB to suspend rule 157 in favor of deceitful accounting for the TBTF banking mafia.

Best Trades to you,

Larry Levin
Founder & President- Trading Advantage
Futures Data
Value Areas:
ES 1411.25 / 1407.75
POC… 1410.00
YM 13115 / 13077
NQ 2633.25 / 2622.25

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