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Archives for November 2017

Is the GOP About to Secretly Raise Taxes?

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Yesterday the Republican leadership unveiled their much anticipated tax cut plan to the world. It is very much still a work in progress. The plan has potential, but also contains flaws that could lead to it actually harming America's potential for greater economic activity. The GOP used to recognize that lowering the top marginal rate would result in a bigger economic-pie for all Americans to share. Now it seems the Republicans have been cowed into a fear of reducing taxes for "the rich" by the Elizabeth-Warrens of the world. Politico reports that the Republicans writing the bill (aided … [Read more...]

What the Tax Cut Means to Me? The Swamp is Alive and Well

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So much for that tax cut we’ve all been hoping for—it looks like the swamp in Washington is alive and well. If this is a tax-cut for the rich, imagine what a tax increase would look like. Don’t get me started. And for all those saying this is a tax cut for the rich, well, the last time I checked you need “money” to get a tax cut—too many Americans have no skin in the game. Americans who I work with—the successful Americans like you—are either still working and saving for retirement, or are already retired and could use a break. Couples in their 50s saving for retirement? Ha! Finally, … [Read more...]

A World Awash in Grains

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A glut of grain crops around the world has depressed prices for wheat, corn, and oats among others. The crops have seen five years of strong yields, filling storage facilities and driving prices way down. Jacob Bunge and Jesse Newman report that grain processors are about to get hit by the big oversupply.  Farmers are opting to store grain rather than sell it to grain companies at low prices. Some food companies, meanwhile, are placing fewer long-term orders for grain and ingredients since prices are expected to stay cheap. As low prices persist, the situation grows more difficult for the … [Read more...]

The Truth Behind the S&P 500, Part III

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“Welcome aboard!” For some reason, maybe it’s because of all the cruise ships that have visited Newport this Fall, I’m thinking about the S&P 500 as this huge cruise ship. Imagine the guests are common stocks, and to go ashore everyone is assigned to a small water taxi based on their size, or market-cap. The biggest companies, are in one water taxi. It barely floats from all their weight. Imagine that sinking water taxi, with its bow barely above water, steaming to shore with its five biggest guests: Facebook, Amazon, Apple, Google, and Microsoft. That water taxi is followed by the … [Read more...]

Meet your New Fed Chairman

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President Trump is expected to nominate Jerome Powell to replace Janet Yellen as Chairman of the Federal Reserve today. Powell is a current member of the Federal Reserve Board of Governors. He was appointed by Obama in 2012 and has kept a low profile. His speeches on monetary policy have hued closely to the company line. All indications are that Powell is a go-along to get-along member of the board. The Street views Powell as a continuity pick who is lighter on regulation than Yellen. Powell is not an academic nor does he have a PhD in economics. A welcome change after suffering through the … [Read more...]

Tesla’s Worst Financial Quarter Ever

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Tesla marked up its worst financial quarter ever at the end of September. With losses mounting, Tesla must speed up its deliveries of Model 3s or see investor confidence fade. Tim Higgins writes: The Silicon Valley auto maker had aimed to make 5,000 Model 3 sedans a week by the end of this year but said it won’t reach the milestone until late in the first quarter of next year. Tesla also reported its worst financial quarter ever, posting a loss of $619 million attributed to common shareholders in the three months that ended on Sept. 30, compared with a rare profit of $22 million a year … [Read more...]

Is Oil Finally Turning the Corner?

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After extensive efforts by OPEC to rein in world oil production, it appears the plan may finally be working to raise estimates of future oil prices. Georgi Kantchev reports that analysts are raising their estimates of the future price of oil. He writes: A poll of 14 investment banks surveyed by The Wall Street Journal at the end of October predicted that Brent crude, the international benchmark, will average $54 a barrel next year, up $1 from the September survey. The banks expect West Texas Intermediate, the U.S. oil gauge, to average $51 a barrel in 2018, also up a dollar from the previous … [Read more...]