Obama is set to speak on the economy at 14:00 GMT. He’ll welcome the somewhat improved employment data but say it is not good enough. He is expected to offer some fresh fiscal stimulus.
The “nuclear option” is unlikely to be used at this point, a payroll tax holiday, though the markets would love it. US workers pay upwards of 7.5% of their paychecks into the social security and medicare systems. If Obama were to propose a payroll tax holiday, that would be a powerful step. Equities would love it. That’s a long-shot, however.
Expect more nibbling around the edges…targeted tax cuts for favored constituencies. That’s been the policy course so far.
