text: CONGRESSIONAL VISIT TO UKRAINE UNITES PARTISANS: A bipartisan Congressional delegation briefed President Biden following a visit to Ukraine. In a classified meeting, the delegation reiterated their belief that Russia remains ready for an imminent attack on Ukraine. The administration accepted their findings and backed ongoing legislative and sanction plans against Russia while providing lethal aid to Ukraine. One senator noted “the additional burden of keeping NATO together” remains a key vulnerability in deterring Russian aggression. (AC: President Biden said during a press conference any U.S. response to Russian military action will be proportional. Press Sec. Psaki quickly clarified the President’s statement, but the message to Russia is clear. The Europeans remain divided on how to address Russia, with Germany and now France signaling a lack of interest in military conflict. Russian information operations across the West will continue to target the NATO alliance and U.S. involvement in Ukraine. Expect increased social and traditional media activity supporting Russia’s claims in the region. – D.M.)Delegation co-chair Sen. Portman (R-OH) briefed the press on his Ukraine visit. Source: APSENATE FAILS TO PASS VOTING RIGHTS BILL: Unable to change the filibuster rules, Senate Democrats failed to pass the Right to Vote Act and John Lewis Voting Rights Act. These bills are now unlikely to become law, but provisions could find their way into other legislation. The stalled progressive agenda marks another major political defeat for the Biden administration. The February budget fights in Congress may include components of these bills, to force support from a “bipartisan” voting block. (AC: The maneuver required “buy-in” from the Senate Parliamentarian to stop debate and had a slim chance of success. Instead of requiring a 60-vote margin to federalize elections, Democrats bet on a Vice Presidential tie-breaking vote. Filibuster holdouts Manchin (D-WV) and Cinema (D-AZ) support the bills, increasing the chance of success in future legislative vehicles. Passage will result in a 25-year lookback at state election laws and procedures, automatic voter registration, a ban on voter-ID, among other deleterious provisions. – D.M.)HAZARDS/WX: InFocus: Inflation, markets, recession, and the dollar demiseAccording to a number of traders, a market selloff is underway. The S&P 500 is down 4% over the past week due to a rise in Treasury yields this year. Rising yields are a good indicator of weak future performance for equities. Sven Heinrich, who goes by Northman Trader, explained this week that a market correction or selloff before the Federal Reserve begins to cut interest rates in March might cause the Fed to delay rate hikes. “[I]f there’s a 15-20% correction before any rate hikes, there will be no rate hikes in 2022,” he wrote. A delay to interest rate hikes would likely sustain higher inflation and could lead to a recession through more hawkish monetary policy. Fed Chair Jay Powell said as much last week: “If these high levels of inflation get entrenched in our economy and people’s thinking, then, inevitably, that will lead to much tighter monetary policy from us, and it could lead to a recession.” As the Fed tries to balance stable market conditions, inflation, and interest rates, we’re also looking at the long term impacts to the dollar. Long term, we still believe that the dollar will weaken substantially as competitors, such as China’s renminbi, continue to erode dollar dominance. I’m waiting for the updated data on the dollar’s share of foreign exchange reserves, last recorded at 59% (image below), which is down from 71% in 2000. With a digital yuan still in its pilot program, having deployed the rough equivalent of just $14 billion dollars, the People’s Bank of China stands to gain financial and monetary influence as the central bank digital currency expands to wider use.