Trump and portfolio impacts

[Packer16]

According to the GAO, the 14% is the amount on average paid by profitable firms but the total amount paid on total pre-tax income (including losses) was 29% and over 40% if state and foreign taxes are included.  I think the average includes alot of smaller business (many private) that pay the lower rates.  Most of the large public companies are the ones paying the higher overall average of 29% so they would in fact see increased AT cash flows if rates decline.

 

As to the military, spending on equipment has a spin-off effect of technology development versus deployment. 

 

If you go by what pols say versus what they do it will not add up that is part of the pol game.  This is especially true with Trump the king of hyperbole.

 

The fundamental are already here, low interest rates.  Lower corp tax rates may also follow.  The scenario that would make stocks more expensive would be interest rates increasing to 5 to 6% from 2 to 3% & I agree that stocks would decline if rates increased that much.  From my reading of history I think it is a long shot.

 

Packer 

[whiterose]

As I've pointed before my exuberance is tamped down by valuations - those still matter. If the S&P P/E would be half what it is I'd be a lot more exuberant.

 

This is and was always true, even under Obama  8)

 

This is especially true with Trump the king of hyperbole.

 

The peeps should have officially made him that: King of Hyperbole™ instead of PE.

[Uccmal]

I hope someone on PEs team explains the basics of presidential economics to him. 

 

i.e. He gets relelected when markets are up and jobs are good. 

 

If he comes out with all guns blazing to tax and spend, and boosts the economy now, he runs a real risk of a recession in 2019.  They need to step back, and let the fed and higher interests rates generate a market correction and mild recession, and then bring the forces to bear in about eighteen months.  Its convenient and easy to cause a market crash, and recession right now with China in the dumper, and lackluster growth elsewhere.  And you can still blame the prior administration for causing it. 

[rb]

Don't give them any ideas.

[rb]

Here's Bill Gross' investor newsletter. I'm not one of his biggest fans but I think he has a lot of good points.

 

https://www.janus.com/insights/bill-gross-investment-outlook

[Jurgis]

Here's Bill Gross' investor newsletter. I'm not one of his biggest fans but I think he has a lot of good points.

 

https://www.janus.com/insights/bill-gross-investment-outlook

 

Not bad.

[rkbabang]

Here's Bill Gross' investor newsletter. I'm not one of his biggest fans but I think he has a lot of good points.

 

https://www.janus.com/insights/bill-gross-investment-outlook

 

Not bad.

 

Not good either.  He'd like the government pay a bunch of people to dig holes so that they can fill them back in again.  I know he said "hopefully in a productive way", but that is a utopian dream that I wouldn't bet on.