Stocks staged a late day rally because the Senate is prepared to kick the can down the road, avoiding any chance of fiscal sanity this year or next.

Whether or not the House will go along is another matter, but unfortunately Speaker Boehner calls House back to Washington on Sunday

The House of Representatives will reconvene on Sunday evening, just less than 30 hours before the United States reaches the fiscal cliff.

House Speaker John Boehner, R-Ohio, notified lawmakers that the House would come to order at 6:30 p.m. ET on Sunday in hopes of averting the end-of-year combination of tax hikes and spending cuts that constitute the fiscal cliff.

The lawmaker on Thursday's call told NBC News that any Senate plan Boehner puts on the House floor (of which there is no guarantee) would only receive as few as 40 Republican votes, making Democratic help necessary.

"If the Senate will not approve these bills and send them to the president to be signed into law in their current form, they must be amended and returned to the House," Boehner told Republicans Thursday, according to a source on the call. "Once this has occurred, the House will then consider whether to accept the bills as amended, or to send them back to the Senate with additional amendments. The House will take this action on whatever the Senate can pass -- but the Senate must act."

Flagpole Rally S&P 500 Futures



The moment I saw that second green candle and volume spike on the S&P 500 futures I knew a deal was in the works even though I could not find any news for a half hour.

Magic Number is 60

MarketWatch reports Senate Republicans open to new cliff deal
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Mike Shedlock

Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.

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30 Comments So Far
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agitator Wrote: Dec 30, 2012 1:36 PM
and throw away the key!
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gjmlb Wrote: Dec 29, 2012 11:25 PM
I totally agree with Mary559's post below and wish to add the following A PENALTY
yup, a penalty i.e. if blah blah is not finalized by blah blah a whatever amount penalty shall
be assessed per day, per official in the amount of blah blah, and same deducted from each paycheck until whatever is finalized. Congress got a raise today, ironic, they should be penalized for incomplete tasks, not get a raise, that is insanity.
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Mary559 Wrote: Dec 29, 2012 10:42 AM
No one, especially the president and his staff, should not have been allowed to leave DC for the past 6 months. If we, personally, have a budget problem we have to stick to our books until it is corrected. Why have we allowed elected officials to "kick the can" for years, while we sweat waiting for their decisions? Maybe if we kick a few of them out at their new elections and tell them why, they might get the picture.
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SMyles Wrote: Dec 28, 2012 6:48 PM
"Lock Congress Up Until They Deal" Right. As if any of the previous "deals" have been good for America.
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tsnyder Wrote: Dec 29, 2012 8:45 AM
Cut there pay checks and see how fast they come up with a deal.
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Colonialgirl Wrote: Dec 28, 2012 5:52 PM
HELL NO!!!
Lock them up UNTIL they CUT all spending by 20% and not just the spending increases either.
Make them develop and vote into place a BALANCED budget with personal and business tax cuts. Whack Obozo off at the knees of he tries an EO about ANYTHING.
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Arley2 Wrote: Dec 28, 2012 4:53 PM
"Lock Congress Up Until They Deal"
____________________________________________

Mike, I have a better idea, which is to drop the last two words in your title for today's column.

"Lock Congress Up.".............period
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kvr929rr Wrote: Dec 28, 2012 4:32 PM
We need to abandon the idea that congress has unlimited power to tax. Have the public set limits on taxation not congress. Then do a conservative revenue projection and have them build a budget that stays within those limits. To hasten the budgeting process, give them five days to come up with one that stays within revenue limits. On the morning of the fifth day start to suck the air out of the room they are locked in until they come up with a budget that stays within those limits.
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David4 Wrote: Dec 28, 2012 4:10 PM
I see a lot of signs that lots of people want us to become a Bolivarian Republic, where the (leftist) President operates with a rubber-stamp Congress. With everything "synchronized" (allusion to 1930s Germany) our Government would run a lot more smoothly and get more done. But would we like what they enact?
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Clayton43 Wrote: Dec 28, 2012 1:32 PM
Given the history of performance by the legislative/executive branches over the last decade, I'll go one better. Lock them all up together in a joint session, throw away the keys and provide no food and water. Come back in 90 days and execute the survirors and hold new elections.
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Grant75 Wrote: Dec 28, 2012 1:01 PM
“Lock Congress up until they deal.” Are you kidding me? What the country needs is Congress on a 10 year furlough.
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Dan883 Wrote: Dec 28, 2012 12:19 PM
I say: Just lock them up.
PTVoice at http://thussaithme.blogspot.com/
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G. Joan Wrote: Dec 28, 2012 11:34 AM
What do you consider "Making a Deal"???? If it is agreeing with the President, who has not been able to pass a budget in the fours years just passed, then I say let the cliff hang.
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FASTMAN2 Wrote: Dec 28, 2012 10:53 AM
I say we JUST LOCK THEM UP in a military prison. It is they that have ruined this country. Especially under this current anti-American administration.
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SteveandJag Wrote: Dec 28, 2012 10:14 AM
As President, I'd veto every bill, unless it passed both Houses by 2/3rds vote. At least we'd have stability, and everyone on the planet would know that the idiots can't work together.
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Kibitzer Wrote: Dec 28, 2012 10:18 AM
In other words you would approve no legislation unless it had enough votes to be veto proof. Wow, what a plan! ;-)
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G. Joan Wrote: Dec 28, 2012 11:37 AM
Oh it is not the idiots in Congress, but also the idiot that resides in the White house. Please give all IDIOT'S CREDIT.
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Kibitzer Wrote: Dec 28, 2012 10:11 AM
"Reid urged the House to pass a Senate bill extending Bush-era tax cuts for those earning $250,000 a year or less. The Nevada Democrat said the House is being operated under “a dictatorship of the speaker.”

Reid is the last person in the world that should be talking about someone else being a dictator, when he has refused to pass a budget for years, refuses to take up house passed bills, etc. His picture should be in the dictionary by the definition of dictator.

Speaker Boehner had it right when he said, "Senator Reid should talk less and legislate more.”
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G. Joan Wrote: Dec 28, 2012 11:39 AM
His picture should be in every Post Office in the USA.
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Kibitzer Wrote: Dec 28, 2012 11:56 AM
Yes there too. But in fairness to Harry, maybe he took one too many right crosses when he he was a boxer, and now has a mental problem.
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M1946W Wrote: Dec 28, 2012 10:05 AM
Recall Obama's goal is to fundamentally transform America so forget politics as usual. As long he can use his rock star, cult-icon status to control the narrative through a compliant, fawning media the hapless GOP will have little opportunity to make their case assuming they have one. Obama's path to power lies in squeezing the middle class in every way possible while continuing to foment social unrest through his most ardent supporters. It's going to make for some interesting times.
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olddog39 Wrote: Dec 28, 2012 9:32 AM
Right now it looks like we need, as Mish said, a deal to balance the budget. BUT we must have a huge majority of agreement to overrule a presidential veto or we get nowhere!
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The Teleprompter Speaks Wrote: Dec 28, 2012 8:56 AM
I think they all ought to be locked up, but letting them out when they make a deal just encourages them to make a deal for the sake of making a deal.

No deal, Mish!
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johnm h Wrote: Dec 28, 2012 6:13 AM
Since no meaningful budget cuts are possible, Congress should allow the Bush rates to snap back to pre Bush levels. We get modest budget restraint and broaden the base. These cuts were mostly Keynsian not supply side and letting them expire won't harm the economy. The real harm to the economy is government spending and regulations. They should focus on these alone.
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The Teleprompter Speaks Wrote: Dec 28, 2012 8:57 AM
Please explain what makes those cuts Keynesian, instead of supply-side?
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johnm h Wrote: Dec 28, 2012 9:19 AM
The significant cuts were at the lower brackets aimed at increasing consumption among folks who spend all of their income. The top bracket was cut only a little, a cut that that could be called supply side as was reduction of capital gains taxes, but the broad sweep of the taxes was aimed at increasing consumption. None of them were necessary to stimulate the economy as the burst dot com bubble would have recuperated quickly on its own and the 9/11 shock was just that, a one time shock. In addition the policy included one time transfers to all tax payers. The cuts gutted the tax code by removing a large percentage of the population from income taxes. That arithmetic is destroying the country.
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Kibitzer Wrote: Dec 28, 2012 10:21 AM
And, just why are no meaningful budget cuts possible? We all know that there is a lot of unnecessary federal spending.
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Ginger12 Wrote: Dec 28, 2012 5:33 AM
Lock them up and throw away the keys and vote in a new government that is Of the People, By the People, For the People instead of what we now have....a corrupt bunch of liars and thieves. Drag them into the middle of the street and administer a public whipping....they deserve it as they, both parties, have destroyed this country from within.
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rcampbell Wrote: Dec 28, 2012 2:04 AM
Great Idea just to make the less comfortable for Both houses of congress would to put them in a 75 foot shipping container and take away there coats.
Then put the container on a C-17 and ship it up to Nome Alaska and then tell knock when you have come up with a deal. And we the American tax payer will see if we will let you out.
Also if there is a tax Increase as part of the deal we have congress use there personal money first the come talk to the American tax payers to see if we will pay pay the tax Increase.
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Dave M Wrote: Dec 28, 2012 3:16 AM
The proposal ignores the role of thePresident. Are you going to lick him up too?

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