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From Ukraine With Love

24 September 2019 by jbchevrel

The July 25 call between President Trump and Ukrainian President Zelenskiy is the focus of a congressional investigation into whether POTUS pressured Ukraine to re-open an investigation linked to the family of ex Dem VP Biden aka ‘sleepy crazy Joe’ in exchange for restarting military support. President Trump acknowledged that he had ordered a halt to US military aid to Ukraine, arguing Europe was not also contributing to fight pro-Russia separatists. That triggered risk selling and CDX IG s33 came wider by almost 3bp through the US morning, along with S&P futures losing ~50 points, back to 2,950s. CDX IG s33 also underperformed Main s32, as per attached chart. Others second-order drivers may include a relatively hawkish speech from POTUS vis a vis China in UN and relatively weak US numbers, including consumer confidence, the supposedly strong link of the economy (nothing massive – 125.1 vs 133.0 expected). Then President Trump said via Twitter he’ll release a complete, unredacted transcript of the call tomorrow, as he is currently at the UN thing. CDX IG s33 reverted -1.25 on that, along with S&P futures rebounding ~20 points. But then the short-lived gains were pared on the back of Pelosi headline -- *PELOSI TO ANNOUNCE FORMAL IMPEACHMENT INQUIRY: WASHINGTON POST. At the federal level, impeachment is a 3-step process. 1/Congress investigates 2/ House of Representatives must pass (by a simple majority) articles of impeachment. At this step, if passed, impeachment is official and then 3/ the Senate tries the accused. In the case of the impeachment of a President, the Chief Justice presides over the proceedings. Conviction in Senate requires a 2/3 majority. And the result of this final conviction is a removal from office. To clarify, tomorrow the House will vote on Trump condemnation resolution tomorrow, which is not the same as step 2/ described above. This is a relatively long process. The last precedent was President Clinton initiated in Oct 1998. The House voted for impeachment in Dec 1998. Senate trial started in Jan and lasted until Feb 1999. Back then obviously the required votes to convict were not obtained.