Budget deal is likely to occur, strategist says

Look for a budget deal sometime in December, Greg Valliere, chief political strategist at Potomac Research Group, said during the opening session at the Schwab conference last Tuesday. House Speaker John Boehner “is smart enough to realize that the last thing he needs is to be the party of obstructionists or the party that lets taxes go up Jan. 1,” Mr. Valliere said.

PRESSURE ON CONGRESS

And President Barack Obama “does not want to start his second term in an economic crisis” by going over the fiscal cliff, Mr. Valliere said. “The final reason I think we get a deal in December is that corporate America, almost to a person, has descended on [Washington] saying, "It's unthinkable if we don't get a deal,'” Mr. Valliere said. This lobbying “has had an impact, especially among Republicans,” he said. “But any idea that we're about to see a big [political] breakthrough ... that will break the logjam in Washington is naive,” he said. “Sadly, the markets are going to have to get angry” before lawmakers act, Mr. Valliere said. “That is the missing catalyst ... The next seven weeks are potentially quite volatile.” djamieson@investmentnews.com Twitter: @dvjamieson