China protests, Fedspeak, lame-duck Congress: What to watch in politics this week

Yahoo Finance contributor Kevin Cirilli joins the Live show to explain three major topics at the intersection of business and politics.

Video transcript

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BRIAN SOZZI: Protests erupted across China over the weekend as frustrated citizens expressed opposition to the country's zero-COVID policy. Let's check in on how Washington is reacting to these protests with Yahoo Finance contributor Kevin Cirilli. Kevin.

KEVIN CIRILLI: So far, no direct word from President Biden on the protests that are being compared, quite frankly, to Tiananmen Square back in 1989. But we did get some forecasting, presumably, from what the administration could say on the Sunday shows over the weekend. In fact, the White House coronavirus response coordinator Ashish Jha told ABC "This Week's" Martha Raddatz, quote, "Obviously, that is not our strategy," relating to the zero COVID lockdowns.

"We don't think that's realistic, certainly not realistic for the American people. Our strategy has been build up immunity in the population by getting people vaccinated. That's how you managed an incredibly contagious variant like Omicron." Now, we should note that lawmakers do return from the Thanksgiving recess this week, and there's a lot of scrutiny, not just politically on what's happening in China but also the economic impacts of that.

Look no further than the reaction that we've seen from Apple and their iPhone production and, again, that continued exposed risk to US supply chains as a result of increasingly unrest in China.

BRAD SMITH: Kevin, separately here, Fed Chair Jerome Powell speaking on Wednesday, what are we expecting to hear?

KEVIN CIRILLI: Well, look, it's going to be his final public remarks ahead of that traditional blackout period before the mid-December meeting that he'll give. He's going to be speaking at the Brookings Institute. A lot of folks wondering whether or not that rate hike-- the rate of the rate hike is going to continue towards the end of the year. The economy does not seem to be going into as severe of a recession as the Fed potentially and Fed watchers had predicted, though they are still anticipating a downturn and a recession for next year.

In addition to that, though, you know, I mentioned China, the impact that China's supply chain policies and zero-COVID policies has on the US economy is something of an oddball-- of an unpredictable wild card, so to speak, for the central bank to continue to monitor. And then separately from that, on Friday, we're going to get that jobs data. So again, some more economic indicators coming in this month as the Fed continues to face pressure on how they're going to navigate inflation.

JULIE HYMAN: And amidst that pressure, you're also watching some political pressure and various political showdowns into your end in Washington. What are you watching? What are those showdowns?

KEVIN CIRILLI: Jules, there's a lot. I mean, this lame duck is-- I mean, they've got such a busy to-do list because they got to fit-- the lawmakers have to pass in the lame duck a government funding bill by December 16, or the government's going to shut down, not to mention that the stakes would even get higher should they not be able to do this in the new Congress, because Republicans, remember, they don't have a significant of a margin in the House, in the House of-- in the House of Representatives that they had originally predicted ahead of the midterms.

So the stakes for the likes of Schumer, McConnell, Pelosi, and, of course, Kevin McCarthy, the core four, as I call them, they've got a lot of-- they've got to pass this government funding bill. And then this other wild card that has emerged is the rail strike, because look, no one is anticipating that Congress isn't going to act should they have to as it relates to the rail strike. But it would occur likely in the same 10-day window as passing a government funding bill. So there could be a lot of high-stakes political theater in the next two weeks in this lame duck.