Morgan Stanley's Michasel Zezas said on.....>

US VIEW: Morgan Stanley's Michasel Zezas said on House & Senate tax bills that

"because the Senate needs to adhere to their process rules, they are in the

driver's seat. They need to formulate a bill that 1) fits with the cap of a $1.5

trillion deficit over 10 years and 2) does not increase deficits beyond the

10-year budget window to be compliant with the Byrd rule. Therefore, as the bill

develops, we believe investors should give greater weight to the provisions

included in the Senate bill over what was included in the House bill (the

exception is SALT)."

- "Senate Finance Committee aides have acknowledged that their draft bill is not

Byrd-rule-compliant and changes will have to be made," he said. "There is no

word yet on how they intend to alter the bill, but we think it likely that there

will be an increased number of phase-ins and sunsets. Overall, we believe the

plan will be more moderate than the Senate draft bill and the bill that the

House Ways and Means Committee passed."