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Delivered daily by 8 a.m., Morning Money examines the latest news in finance politics and policy. | | | | | |  | | By Ben White and Aubree Eliza Weaver | Editor’s Note: Morning Money is a free version of POLITICO Pro Financial Services' morning newsletter, which is delivered to our s each morning at 6 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day’s biggest stories. Act on the news with POLITICO Pro. | | | Welcome to infrastructure week … again — Senate Majority Leader Chuck Schumer has set up a deadline of sorts for Wednesday to begin debate on a bipartisan infrastructure bill in hopes of getting it done before the August recess. Only problem is there is no bipartisan infrastructure bill and may not be one this week. And the proposed pay-for to cover the $1 trillion package — boosting tax collecting enforcement at the IRS — is now dead. Republicans over the weekend ripped Schumer’s proposed time line, arguing that he should just let legislators draft the bill first and perhaps get to a vote next week. Schumer also wants Democrats to agree this week on everything that would go in a massive $3.5 trillion budget reconciliation bill to pass much of Biden’s “Build Back Better” agenda including expanded Medicare, clean energy, immigration reform, universal pre-K and much more with only Democratic votes. Both things seem almost impossible to accomplish by Wednesday, which would just generate negative headlines for Democrats about a stalled agenda. Compass Point’s Isaac Boltansky: “As we have seen time and time again … time is distorted during any infrastructure week and deadlines become laughably unenforceable. “Our sense is that the Wednesday deadline is little more than an attempt to manufacture a sense of urgency, but that artificial effort will be bolstered by the actual calendar as the fear of working through the August recess remains one of the most important motivators on Capitol Hill." The great big hope — Pantheon’s Ian Shepherdson articulates exactly what the White House is banking on happening at summer’s end: “[W]e're expecting the pace of payroll growth to double, at least, by the fall, as labor supply gradually increases in the wake of school reopening and the end of the enhanced unemployment benefits.” GOOD MONDAY MORNING — Email me on bwhite@politico.com and follow me on Twitter @morningmoneyben. Email Aubree Eliza Weaver on aweaver@politico.com and follow her on Twitter @AubreeEWeaver. | | | President Biden today at 1:30 p.m. “delivers remarks on the economic … and why we need the Bipartisan Infrastructure Framework and his Build Back Better agenda to sustain that growth in the years to come” …. Biden travels to Cincinnati on Wednesday to visit a union training center and take part in a CNN town hall … House Financial Services has a hearing at 10:00 a.m. on Tuesday with HUD Secretary Marcia Fudge. … Senate Banking has a hearing on Tuesday at 10 a.m. on climate change risk … House Financial Services has a hearing Wednesday at 10:00 a.m. on the under-banked and another at 2 p.m. on the bond rating agencies Also this week : “Rising Tide: Challenges and Opportunities for Regulated Decentralized Finance. The event will take place from July 19-22, and will include key players involved in the digital assets ecosystem.” WALL STREET CLOSING DINNERS (AND MORE) ARE BACK — WSJ’s By Cara Lombardo and David Benoit: “Wall Street investment bankers are well-accustomed to jockeying for multimillion-dollar fees on corporate deals. Now, the game is focused on just showing up. “After more than a year of Zoom, Wall Street’s elite are beginning to emerge from behind their screens and returning to the timeworn custom of in-person client visits, handshakes and wine-soaked dinners. Rivals Goldman Sachs Group Inc. and JPMorgan Chase & Co., which have already brought their employees back to the office faster than the rest of Wall Street, are urging their bankers to get out and visit boldfaced corporate clients —and quickly, before others do.” | | | | STEP INSIDE THE WEST WING: What's really happening in West Wing offices? Find out who's up, who's down, and who really has the president’s ear in our West Wing Playbook newsletter, the insider's guide to the Biden White House and Cabinet. For buzzy nuggets and details that you won't find anywhere else, subscribe today. | | | | | ASIA DIPS ON VIRUS AND INFLATION SCARES — Reuters: “Asian shares slipped again on Monday while perceived safe haven assets, including the yen and gold, edged higher as investor risk appetite was soured by fears of rising inflation and a relentless surge in coronavirus cases. … “Global economic growth is beginning to show signs of fatigue while many countries, particularly in Asia, are struggling to curb the highly contagious Delta variant of the coronavirus and have been forced into some form of lockdown. "The spectre of elevated inflation, which the market has long feared, is also haunting investors. Economists at Bank of America have downgraded their forecasts for U.S. economic growth to 6.5% this year, from 7% previously, but maintained their 5.5% forecast for next year.” GAS PRICES MAY EASE — NYT’s Stanley Reed: “Major oil producers reached a deal on Sunday to increase production, a move that could help ease the pressure on gas prices and inflation as economies around the world recover after pandemic lockdowns. “The pact by OPEC Plus … aims to begin pumping more oil beginning next month. It resolved a dispute between the United Arab Emirates and Saudi Arabia that had blocked an agreement earlier this month and caused oil prices to spike, briefly hitting six-year highs on July 6. “Even before that, gasoline prices in the United States had been steadily rising. The average price of a gallon of regular gasoline in the United States is now $3.17, according to AAA. A year ago… gas cost just $2.18 a gallon on average” | | | RECORD STOCK RALLY IGNORES WALL STREET’S PHOBIA ABOUT OPTIMISM — WSJ’s Caitlin McCabe: “The latest victim of the rampaging bull market in stocks is the Wall Street maxim that glowing investor sentiment is a sell signal. Throughout 2021, a range of surveys, fund-flow figures and options activity have shown investors big and small to be exceptionally bullish. Yet major U.S. indexes continue to rally to records, putting the Dow Jones Industrial Average up a healthy 13% for 2021. “Analysts have long relied on sentiment and related data on risk-taking as contrarian indicators. By the time friends, colleagues and strangers are plowing money into stocks and telling you about it, it’s time to run for cover, to this way of thinking. Likewise, when everyone is selling, you should be buying with both hands.” RISKS OF CRYPTO STABLECOINS ATTRACT ATTENTION OF YELLEN, FED, SEC — WSJ’s Paul Vigna: “Stablecoins, digital currencies pegged to national currencies like the U.S. dollar, are increasingly seen as a potential risk not just to crypto markets, but to the capital markets as well. "Treasury Secretary Janet Yellen is scheduled Monday to hold a meeting of the President’s Working Group on Financial Markets to discuss stablecoins, the Treasury Department said Friday. The group includes the heads of the Federal Reserve, the Securities and Exchange Commission and the Commodity Futures Trading Commission.” CRYPTO TRADERS LOVED BIG LEVERAGED BETS UNTIL UNEXPLICABLE CRASH — Bloomberg’s Justina Lee: “On the day of one of the cryptocurrency market’s worst routs, Alex Holland woke up to a wave of messages from friends and family. They knew he had made a big wager recently that prices would fall. But when he went to check his account on the online exchange Binance, he saw that the value of his leveraged bet against Ethereum was sinking rather than reaping gains a few times greater than the declines in the second-largest cryptocurrency.” | | | KASHKARI: MANY SECTORS STRUGGLING TO ADJUST TO REOPENING — Reuters: “Minneapolis Federal Reserve President Neel Kashkari said many U.S. economic sectors faced rapidly rising prices and were struggling to adjust to reopening after the shutdown. ‘Basically, what's happening is the U.S. economy went through a very abrupt shutdown a year ago,’ Kashkari told NPR in an interview published on Saturday. ‘And now it's going through a reopening, and you're seeing many sectors of the economy struggle to make that adjustment.’” RED HOT ECONOMY EXPECTED TO COOL FROM HERE — WSJ’s Sarah Chaney Cambon and David Harrison: “The U.S. economy’s 2021 growth surge likely peaked in the spring, according to economists who expect to see a slower but still-strong expansion into next year. "Widespread business reopenings, rising vaccination rates and a big infusion of government pandemic aid this spring helped propel rapid gains in consumer spending — the economy’s main driver. But that burst of economic growth is starting to ebb, economists say.” THE PANDEMIC SAFETY NET IS COMING APART. NOW WHAT? — NYT’s Tara Siegel Bernard and Rob Lieber: “One by one, pandemic relief programs that financially supported millions of Americans are going away. With legislative packages worth trillions of dollars, the federal government wove a temporary safety net that provided help for people dealing with lockdowns, job losses and worse. "But many of the most far-reaching protections, including eviction moratoriums and expanded unemployment benefits, are about to expire. Provisions affecting student loans, food stamps and more are scheduled to follow in the coming months.” | | | | Be a Policy Pro. 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