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Photo: Win McNamee/Getty Images

Within a day of tweeting that he was calling off bipartisan talks for a coronavirus stimulus deal, President Trump phoned House Minority Leader Kevin McCarthy and indicated he was worried by the stock market reaction and wanted a "big deal" with Speaker Nancy Pelosi, per two sources familiar with the call.

What we're hearing: Trump was spooked after seeing the instant drop in the stock market and intense backlash to his tweet, and he has since directed Treasury Secretary Steven Mnuchin to push for a more comprehensive relief bill before the election.

  • He wants a deal that would go beyond securing aid for the struggling airline industry and extending the small business Paycheck Protection Program.
  • Mnuchin swiftly acted on the president's directive and called Pelosi Wednesday evening to tell her negotiations were back on, per a Democratic congressional aide.

Why it matters: Few people on Capitol Hill thought a large-scale stimulus deal would be reached before Election Day, and it's still very unlikely both sides can compromise by then. However, Republicans did not expect Trump to be the one to walk away from the table, and they were even more stunned he did so in such a public way.

  • Washington leaders were even more baffled when, shortly after Trump said he wanted his team to abandon negotiations, he contradicted himself by responding to a headline citing Federal Reserve chair Jerome Powell calling for more fiscal stimulus and saying Congress has a low risk of "overdoing it." Trump's response: "True!" 
  • The sources say Trump told McCarthy in their Wednesday phone call that he agreed with Powell. Trump has long held the view that a bigger deal that delivers more money directly to Americans and businesses would help him win re-election.
  • The White House and McCarthy's office didn't respond to requests for comment.

Between the lines: A person who spoke with Trump yesterday said that while he would never use the word "regret" about scuttling the negotiations, they got the strong impression that Trump realized he had messed up tactically.

  • Trump himself immediately backtracked in a series of tweets later on Tuesday, trying to portray himself as willing to deal and to portray Pelosi as the intransigent one.

The catch: Trump may want a big deal — one where he'd spend several trillion dollars to help himself get re-elected — but that was never going to fly with Senate Republicans. They've long been wary of yet another massive pandemic relief package after all of the money Congress has already spent.

The latest: Trump, during an interview on Fox Business Thursday, said his team was "starting to have some very productive talks" on a bill.

  • "I said, look, we're not getting anywhere: Shut it down. I didn't want to waste time. But in any event, we got back — both sides very capable — we got back, we started talking again," the president continued. "And we're talking about airlines and we're talking about a bigger deal than airlines. We're talking about a deal with $1,200 per person, we’re talking about other things."

What's next: Democrats and Republicans are still hundreds of billions of dollars apart and disagree on what's needed in the bill, and with only 26 days until Nov. 3, an agreement by Election Day is still widely seen as unlikely.

Go deeper

Dave Lawler, author of World
Oct 30, 2020 - World

How Biden might tackle the Iran deal

Photo illustration: Aïda Amer/Axios. Photo: Drew Angerer/Getty Images

Four more years of President Trump would almost certainly kill the Iran nuclear deal — but the election of Joe Biden wouldn’t necessarily save it.

The big picture: Rescuing the 2015 Joint Comprehensive Plan of Action (JCPOA) is near the top of Biden's foreign policy priority list. He says he'd re-enter the deal once Iran returns to compliance, and use it as the basis on which to negotiate a broader and longer-lasting deal with Iran.

Federal Reserve expands lending program for small businesses

Federal Reserve Chairman Jerome Powell at a news conference in 2019. Photo: Eric Baradat/AFP via Getty Images

The Federal Reserve said on Friday it would again lower the minimum loan size for its pandemic-era small business program.

Details: Businesses and nonprofits will be able to borrow a minimum of $100,000 from the facility, down from $250,000 — a move that might attract smaller businesses that don't need as hefty of a loan. Since the program launched earlier this year, the minimum loan size has been reduced twice.

2 hours ago - Health

Ipsos poll: COVID trick-or-treat

Data: Axios/Ipsos poll; Note ±3.3% margin of error for the total sample size; Chart: Andrew Witherspoon/Axios

About half of Americans are worried that trick-or-treating will spread coronavirus in their communities, according to this week's installment of the Axios/Ipsos Coronavirus Index.

Why it matters: This may seem like more evidence that the pandemic is curbing our nation's cherished pastimes. But a closer look reveals something more nuanced about Americans' increased acceptance for risk around activities in which they want to participate.

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