Today's healthcare vote has turned into a Republican referendum on Trump
Sometimes a vote is just a vote. Trump's healthcare reform in its current form is dead-on-arrival in the Senate so whatever happens Thursday in the House won't really matter.
But it will in markets. Because sometimes a vote isn't just a vote. At times like this it's a barometer for how well an administration can impose its will.
Lost in much of the post-election trade was that despite Trump's win, the civil war in the Republican party wasn't over. There are some uncompromising, strong-willed Congressmen who distrust their own party.
All parties have that and members generally fall into line. But not always. The Tea Party of Freedom Caucus isn't easily bullied or concerned about optics.
Because of that, today's vote is viewed as a measure of cohesiveness in the party. If it's fractured so early in the term, that points to trouble ahead.
To wit, bond king Jeff Gundlach is out saying that if the healthcare vote fails, it will case a lot of doubt on Trump's agenda.
"If you can't pass the repeal, everything else is in doubt," he said.
I'm not going to argue against Gundlach but I think there's a third option and it's that Trumpcare is poor legislation. Members of Congress want it fixed in one way or another and that's when a compromise will come. I think markets are underpricing that trade. Win or lose, Trump's administration isn't falling apart.
