| Biden's big plan, Powell kills the taper, and another grim Covid milestone. Fiscal Stimulus President-elect Joe Biden's $1.9 trillion economic relief package includes proposals likely to be opposed by many Republicans, which may lead to drawn-out talks before an agreement is reached. While many of the elements in the plan could pass the Senate with a simple 50-50 partisan split, some such as state aid and money for health care will likely need 60 votes in the chamber. The timing of the impeachment trial of President Donald Trump could add another road block to a swift agreement on new stimulus. House Speaker Nancy Pelosi in her weekly press conference later today is expected to issue some guidance on when she plans to move the article of impeachment to the Senate. Monetary Stimulus Federal Reserve Chair Jerome Powell put a lid on talk about tapering assets purchases saying that "now is not the time" to hold that discussion. He made clear that the bank had learned the lessons from the 2013 taper tantrum, and said policy makers would give plenty of notice on any moves to trim bond buying. In Europe, several ECB officials this morning warned of the damage the pandemic has done to the region's banks, with the full effects yet to be felt due to the massive policy support that is in place. They warned that this year and next could see a wave of corporate bankruptcies as government support is withdrawn. Two million The global death toll from the coronavirus pandemic is about to hit 2 million, with few expectations that the pace of fatalities will slow any time soon. Deaths in the U.S. will likely reach 400,000 before the end of the month as Joe Biden promises to speed the vaccination effort he called a "dismal failure." In Germany, Angela Merkel is pushing to further tighten the country's lockdown as deaths there rose by a record amount in the past 24 hours. Clusters of the virus which recently emerged in China are growing, with cases now in at least nine provinces. Markets slipInvestor reaction to Biden's stimulus plan and Powell's reassurance over policy has been muted so far, with equites posting declines. Overnight, the MSCI Asia Pacific Index slipped 0.5% while Japan's Topix index closed 0.9% lower. In Europe the Stoxx 600 Index was 0.5% lower at 5:50 a.m. Eastern Time with energy stocks under pressure. S&P 500 futures pointed to a small drop at the open, the 10-year Treasury yield was at 1.114%, oil was lower and gold gained. Coming up...U.S. December retail sales, PPI and January Empire Manufacturing data are at 8:30 a.m. Industrial and manufacturing production for December is at 9:15 a.m. and the latest University of Michigan sentiment numbers are at 10:00 a.m. It's a big earnings day for Wall Street with JPMorgan Chase & Co., Citigroup Inc., and Wells Fargo & Co. all reporting results. What we've been readingThis is what's caught our eye over the last 24 hours. And finally, here's what Emily's interested in this morningThe yield curve's fame has gone to its head. Maybe it's those decades of correctly forecasting recessions. Now, the curve is more mercurial than a celebrity relationship. Ahead of the election it was steepening, then not, as the realities of a likely split Congress and some harrowing data on the virus and economic shutdowns sank in. Then it's back on with Georgia, stimulus, and taper talk...but some Fed pushback and decent auctions and it's off again. We expect this sort of stuff from stocks. This is the bond market, darn it. The flip-flopping is a strong signal in itself -- there's a lot still standing in the way of this reflation trade. Recent events raise further objections to the case for the back end of the curve to rear up much more. 1. The Federal Reserve's most senior officials have nixed speculation that the central bank could start trimming its bond purchases as soon as this year. Fed Chairman Jerome Powell stomped on the curve with the comment Thursday: "We know we need to be very careful in communicating about asset purchases...Now is not the time to be talking about exit. I think that is another lesson of the global financial crisis, is be careful not to exit too early."
That echoed a similar sentiment from Vice President Richard Clarida this week. And Governor Lael Brainard slapped down any suspicion that the Fed might already be wavering in its commitment to allowing inflation to run hotter -- stressing that the Fed's inflation goals are reflected in its guidance on asset purchases. And as a reminder of the inequalities the Fed is striving to address with its new strategy, she had this: "Federal Reserve staff analysis indicates that unemployment is likely above 20 percent for workers in the bottom wage quartile, while it has fallen below 5 percent for the top wage quartile."
 2. Perma-bulls Hoisington are still rooting for Treasuries -- the 30-year, to be specific, since, as they drily put it, "a secular inflation cycle is not at hand." The bond market veterans explained why in their quarterly outlook released this week, citing the pandemic shock, low to negative U.S. fiscal multipliers and the debt overhang. With a new pandemic relief plan now on the table, and an infrastructure spending pitch in the pipeline, the Democrats are going to do the best they can with that second argument. Follow Bloomberg's Emily Barrett on Twitter at @notthatECB Like Bloomberg's Five Things? Subscribe for unlimited access to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. | 
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