CNBC's Santelli: Tea Party Popularity 'Dollar-Friendly'
It’s often said markets function better when there is gridlock in
On CNBC’s Dec. 17 “Squawk Box,” CNBC Chicago Mercantile Exchange reporter Rick Santelli debated what was causing the recent rise in the U.S. dollar. Santelli, the original inspiration for the tea party movement, squared off with Jim Iuorio, CNBC “OptionsAction” regular and CME trader, about the cause – a weakened European economy or the place in the calendar year.
“So Rick, is the bigger deal right now on the dollar move – the risk-aversion trade because of the end of the year or because of the problems in
Santelli admitted the dollar could be going higher and said this trend was more than just end-of-the-year timing.
“You know, I think that the dollar trade is still going to be the counter-trend but I would say it could be much bigger than just what's going on end of year,” Santelli said.
But Iuorio alluded to the $155-billion in so called “job creation” legislation that narrowly passed in the U.S House on a 217-212 vote late on Dec. 16 and its possible impact on the dollar.
“Well, to pile onto that, too – just yesterday $155-billion job creation bill was talked about – $79 billion of those dollars, the thing that strikes me as funny is that they’re ‘leftover’ TARP funds,” Iuorio said. “I don't particularly remember having a vote on where that money should go.”
Santelli wasn’t optimistic that legislation was going anywhere and said as long as Congress faces tough roadblocks, the less spending that can be done, which is good for the long-term prospects of the U.S. dollar.
“You bring up a great point Jim,” Santelli said. “Because – I don't know, I'm going to give you a strange vision of – I think that's a dollar-friendly because the way it was passed in the middle of the night, I just think that there's no way that this is going to get legs. And, I think that a lot of things going on in
Iuorio pointed out the how desensitized people have become to these huge spending initiatives and that $155 billion wasn’t exactly chump change.
“I like the way you describe it better than me, but I worry when they start throwing these things off like kind of as a side note,” Iuorio said. “Like, ‘Yeah, we're going to dump $155 billion towards this. It's scary.’”
But this is where Santelli plugged the Tea Party movement, and explained that an NBC/Wall Street Journal poll showing the movement rated higher than the Democratic or Republican parties. That according to Santelli is a sign moving bills through the legislative process was going to be tougher and a positive for the
“You know what – this new poll that shows the ‘Tea Party’ is more popular than Republicans and Democrats, I think that at the heart of that is – you can pass anything you want in the middle of the night, doesn't mean it's going to ever be reconciled by both houses or be signed by anybody and I think that's a big dollar-friendly as well.”
“Wow, you being optimistic,” Iuorio said. “That's amazing to me. Way to go.”
