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this is your weekly Washington Policy Pulse on the Balance of Power podcast. I'm Joe Matthew. Every Monday, Bloomberg Intelligence, senior policy analyst and friend of the show, Nathan Dean, shares his weekly call on upcoming catalysts in the nation's capital. Listen for the most recent and relevant policy research from our team at Bloomberg Intelligence. Now with today's installment, here's Nathan Dean.

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Good morning and good afternoon, everybody. My name is Nathan Dean. I'm a senior policy analyst with Bloomberg Intelligence, coming to you from the Washington, D.C. bureau. Want to say thank you. For those of you who are coming to us via the Balance of Power podcast, we always appreciate you listening. Now, today is April 27th. We're timestamping this at 10:02am Eastern Time just because obviously things happen fairly quickly these days in Washington. But before we get today's events, for those of you who have Bloomberg terminals, I wanted to highlight a report that we just put out. This is going to be a living report on President Trump's affordability goals. And essentially, just to give you the title of the report, it's Trump's Financial Affordability. Push big levers. Sorry, big promises, small levers. You get this idea that as we are heading into the midterms this year, there's going to be a lot of discussion on affordability. There's going to be a lot of things coming from the Trump administration on affordability with a various amount of impacts. So what we did, we started with housing, financial services, we broke it up into banks and credit cards. And then over the next few weeks, we're looking to add agricultural, industrials, consumers, energy, et cetera. And again, it's going to be a living report. And then we're going to turn it into the plan here is to turn it into one of our PDF reports called the Deep Dive, which will then give you a really good look in advance of the midterm elections, what President Trump is trying to do on affordability and as we get through the midterms, how it bleeds into the second half of the Trump administration. So again, if you have a terminal, I can point that to you today. Otherwise, you know, just stay tuned and we'll be adding more and more to it from there. So let's talk about what's happening here this week. Now, obviously, we had the shooting over at the White House Correspondents Dinner on Saturday night. Republicans are and we saw this with President Trump's press conference that happened just after. They're trying to translate this into this idea of pushing for President Trump's ballroom. Now, the ballroom doesn't have any impact on those of us who focus on markets. But the reason why I bring it up is because there's a potential that you could see Republicans try and say, look, let's codify some of the ballroom language or some of the ballroom funding, which is where sort of the court issues have popped up into this idea of the reconciliation 2.0 bill. Now, when it comes to reconciliation 2.0, just remember this is a $75 billion deal. This would fund the Department of Homeland Security for the next three and a half years, takes it out of the Democratic's hands in terms of a leverage point for the rest of the Trump administration. And just as a reminder, what happened here is the Senate authorized up to $140 billion over 2. But the idea here is that you're going to get $75 billion. So even though the authorization is up to 140 billion, you may have seen that headline. The idea here is that Senate's going to keep it around $75 billion. Now, you know what you're going to see is, I think later this week is you're going to see the process begin. There's going to be another vote. Eventually you're going to see a vote. A what a voterama is, is that every senator who's in this debate has the ability to come to the floor and say, look, I want to do a vote on this or I want to do a vote on that. And Democrats will most likely create some very, I'd say, difficult votes for the Republicans. And the reason why I call it Vote A Rama is that it goes all night. I mean, don't get me wrong, I'm not staying up for it. God, you know, if you're listening to us and you're on Capitol Hill at the moment, get the Gatorade, you know, get some of the caffeine going because it's always a very late night. And I know the staffers actually hate it. But, you know, sometime the Vote A Rama is going to take place. And we do think this reconciliation bill will pass. And as A reminder, all the other things you're hearing about in terms of tax changes, Save America act, potentially Obamacare changes, farm aid, et cetera, like that, that's all being saved for reconciliation 3.0, which wouldn't take place until the lame duck period. And we'll have further thoughts on that. But I had to, I put an update out on the terminal where again, just essentially just repeating what I just said here. So that's what's going on with reconciliation. It's also important to note that you may see some headlines about an idea of a war powers resolution. I said this before in this call, so I'm not going to really go into deep dive here. But May 1 is the 60 day deadline for the Iranian conflict. President Trump gave formal notification to Congress on March 2, gets 60 days. And under the War Powers act of 1973, that's when Congress has to give its blessing or some type of act of war designation or anything like that. Now, President Trump does have the ability to come back and say, I want an additional 30 days. But that's usually, guys, it has to be notified in writing. It has to be for the idea of safe withdrawal of US Forces. What's going to happen here is probably nothing. The Democrats may try and push another war powers resolution vote, but I think you're going to see steps in the White House to say, look, that we don't need this authorization. We have other authorizations that we need to rely on. We don't need to do this. And in fact, Senator Cynthia Lummis, the Republican from Wyoming, even just said last week she's perfectly comfortable with this continuing without some sort of war powers authorization. So they're already getting political cover to the White House. So this is just headlines. I don't think it changes anything. But just keep this in mind. So let's move away from Iran. Let's talk about Kevin Marsh. So on Friday, we saw, you know, the D.C. attorney Jeanine Pirro, funny enough, I actually saw her at the dinner on Saturday night come out and say that she's dropping the investigation or has ordered her attorneys to drop the investigation to Kevin Marsh, but reserves the right to come back and actually reopen the investigation if things happen. The investigation was then transferred over to the attorney general. I'm sorry, the invest the IG of the Federal Reserve and you know, nothing prevents going forward for the IG of the Federal Reserve under the guise of the chair to come back and say, look, you know this, there's criminal activity here and this needs to be reopened but it was enough for Senator Thom Tillis to come out and say, look, he said this on the Sunday shows yesterday that he is now going to support Kevin Moshe as its nomination or through the nomination process. So now the Senate Banking Committee is earing a vote on Wednesday. Can the Senate Banking Committee and can the Senate get Marsh in before May 15? Absolutely. They can probably do this fairly quickly. And in that scenario though, the question is, okay, if Jerome Powell is no longer the Fed chairman, does he remain as Fed governor? And Eliot Stein put this out on the terminal. I've been talking with Eliot over the weekend and our view is, is that Jerome Powell most likely would stick around because as long as this investigation is continuing, you know, Jerome Powell is just going to probably just stay at the Governor as a governorship just to continue that ability to be as part of the Federal Reserve. So you're probably not going to see Jerome Paul really give much of an indication later this week when they do the press conference. You know, probably just going to be open minded stuff. But our take is, is that Jerome Paul would most likely stay. So again, that's what's going on with the Kevin Moore nomination now a little bit just more of a setting of what we're going to see over couple weeks. We were supposed to have a highway authorization bill markup this week out of the House. Representative Graves is looking for around 500 to $550 billion worth of new funding. This is for those of you who play in the infrastructure in the industrial space. So as a reminder, the Infrastructure Investment jobs Act, the IIJA had $1.2 trillion in. If you go back to Infrastructure Week, remember Infrastructure Week was almost every single week of the first Trump administration. The IJA had $1.2 trillion. Now we're still trying to get better idea of how much money is allocated out there that hasn't been spent. Rough estimates I've seen is around $300 billion. But what this $500 billion would do is this would be over five years and this has to be done by September 30 this year. If not, you're going to see a kick in the can. Now we haven't seen the bill text, but most of this from what I'm hearing is geared towards bridges, highways, backbone infrastructure stuff. Nothing more like electric vehicles or anything like that. We're just literally talking about bridges and cement and stuff like that. So stay tuned. That markup has been pushed into May, but you know, that's something that we're keeping an eye on. You're Also going to see a vote on the farm bill this week. The farm bill has been, is turned partisan. Usually it's not. I've looked at the farm bill. It's not all that exciting for those of us in the markets. As a reminder, farm bills are usually more exciting because they include the snap benefit portion of that that was actually dealt with as part of the one big beautiful bill. And so that has been taken out of the farm bill. So again, I'm just putting this out here for headlines. If you are interested in the farming sector, please let me know. And we did put an update though that we think that the $20 billion that was earmarked for farm Aid, like I mentioned earlier, is now going for reconciliation 3.0. So again, I don't think you're going to see anything crazy happening in the farm space. Let's talk about marijuana rescheduling for a second. So last week we saw the acting Attorney General Todd sign a final order, not a final rule, but a final order that reschedules FDA approved and state licensed marijuana. We saw the pot stocks go up. We'll saw, we saw the pot stocks come down. I'll get to the questions after, after this. We saw the pot stocks go up, we saw the pot stocks go down. And as a result, you know, we, we essentially now have reschedulization. Now this is sort of interesting though because in the final order, what the acting Attorney General did is use the fast way towards reschedulization. The fast way is essentially is relying on treaty obligations. And I actually this is kind of interesting. They relied on treaty obligations, meaning the United States needs to meet its treaty obligations to a 1961 United nations treaty on Narcotics which was further amended in 1972. So under that obligation of that treaty, marijuana is now rescheduled. But in the press release that the Department of Justice put out, they essentially also said that there's going to be hearing on June 29 to complete the slow way, they call it the expansion of marijuana. So marijuana has now gone from Schedule 1 to Schedule 3. And look, it was effective immediately. So that's taken place. But if you are a marijuana company, the problem that you've got now is this, is that it's only rescheduled for FDA approved and state licensed products and it's not approved for recreational marijuana. So if you're selling, if you're selling products that are going for medicinal purposes now, you get the 280 tax relief. If you're selling products that go to the recreational usage, that does not give you two 80e relief. So that hearing that comes out in June is most likely going to be an expansion. But again none of this makes it federally legal. I mean this is, you know it's, it's, you know if you still do it on the federal property, for example if you're in Logan Circle, if you're on the National Mall in the district land is decriminalized, you walk across the street. It is not. And there have been instances in which people have walked across the street and have gotten tickets so that murkiness still exists. And that's going to really keep the banks I think out of the pot banking business because when you have things like the bank secrecy act and the anti money laundering issues the revenue is just not worth the risk. We just had a question on the Fed Cook case. Lisa Cook still to be determined. Elliot has his note out on the terminal. So to the terminal client I'll put you in touch with Elliot. But the next possible Supreme Court decision case is Wednesday at 10am so the way I would track this when it comes to Lisa Cook is is that the Supreme Court announces a couple days in advance when it's going to release its returns and I know Elliott's listening to this call right now so Elliot can certainly come back onto the record and correct me. Ellie, just send me an IB and I'll correct it this way if I'm, if I'm wrong here is that the Supreme Court does notify a couple days in advance when the issues are going to be resolved. They are at 10am now at that point there is a blog called SCOTUS Blog. It's not connected to Bloomberg but SCOTUS blog will actually release out almost by minute minute what the number of boxes is meaning the number of cases that are going to be determined and et cetera. So that's where you get an idea of where the Lisa Cookcake So Elliot just confirmed the next opinion date is on Wednesday. So that's what's going on with Lisa Cook in Elliot's case. You know Elliot's piece that he says on the terminal is that Lisa Cook most likely will win that decision. So to the other question on Senator Lummis, the Wyoming senator from Miam, why not give a formal blessing to War Powers Resolution if they're continue if they're comfortable continuing is honestly you're probably not going to get the votes. The House has shown and the Senate has voted that there is generally an uneasiness with the Iranian conflict and, and even if the person publicly says that they support President Trump and they support his strategy. This is not something you want on the record, especially when it comes to a war powers resolution that President Trump would ultimately veto if it were to go against his position. So it's an uncomfortable vote. So for a lot of these lawmakers, it's just much easier to pass on the vote and just not have that vote in particular. Real quickly, just a couple other things. King Charles and Queen Camellia, sorry, Camellia, Queen Camilla are here in D.C. this week. They are here today. They're going to be meeting over the White House. There is a state dinner tomorrow night. King Charles is going to address Congress. So look for additional Honestly, it's not all that important for those of us on the investment space from the news perspective. I mean, there could be some questions about Jeffrey Epstein. But again, for those of us in the markets, it's just a nice visit and it's pretty to see the Union Jack flying around the United States. States are around Washington, D.C. crypto stuff. Just my only real update on crypto is that you're not going to see a markup this week. It's been kicked into May. No real update there. And then this week you are going to see a House Financial Services Committee on the Basel III endgame and on capital. This is essentially a way for the policymakers to listen to the industry via their trade associations. This is going to be tomorrow at 10am the thing to note here is, is that the really interesting thing about the Basel III endgame is I want to see how much pushback people like the Bank Policy Institute and the American Bankers association have announcing this in the hearing tomorrow. Because you saw Jamie Dimon over at JP Morgan. I almost said Jamie Dimon over Jerome Powell. You saw Jamie Dimon over at JP Morgan voice a displeasure with certain aspects of the Basel III endgame. Long story short is, is that the regulators could have gone much further than they didn't. And if you talk to Arnold Kakuda, our senior credit analyst, he's actually got a chart we can send this to you that shows that JP Morgan actually gets the same amount of relief as bank of America, but JP Morgan has a lot more capital requirements to hold. And as a result, if I'm Jamie Dimon, it's like, well, why am I not getting the same amount of relief as bank of America? And there's a little bit more specifics to it, but that's the gist of the story. I want to see how much pushback the industry has in this hearing tomorrow because Bloomberg News folks and this is Katanga Johnson just reported last week that the Fed Vice Chair, Michele Bowman essentially said to the banks, stop the complaining, don't complain about this. This is what you're getting. So I'm really curious to see how much the banks are going to complain in this hearing that is tomorrow at 10am over at the House Financial Services Committee. So I don't see any further questions. I want to say thank you very much for attending. We always appreciate it. If we can ever be of a service, please don't hesitate to reach out and we'll talk soon. Take care. Bye.