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Update – Washington

December 20, 2017 | Weekly Commentary

The U.S. stock market has jumped since the November 8th election. We identified 4 initiatives on which the U.S. stock market is speculating to be successfully accomplished early in the Trump administration. What will happen next? It is still to be determined!

The 4 initiatives will have a tremendous influence on the “Heat Map” which forms the basis of our forward looking view of the U.S. economy. We consider the success or failure of the 4 initiatives to be “leading” indicators for the Heat Map.

Below are the 4 Trump administration initiatives upon which the stock market is speculating and what progress, if any, has been made:

  1. Tax cuts and tax reforms benefiting most individuals and businesses. THE SENATE AND HOUSE PASSED THE TAX BILL AND THE PRESIDENT HAS INDICATED HE WILL SIGN ASAP.  CUMULATIVE PROGRESS TOWARD GOAL: 100%

  2. Infrastructure spending of up to $1 Trillion over the upcoming 7 to 10 years. COMPLETION OF TAX REFORM POINTS TOWARD PROGRESS IN THIS AREA, TOO.  CUMULATIVE PROGRESS TOWARD GOAL: 35%

  3. Affordable Care Act amendment, reform or reorganization. THE TAX BILL REPEALS THE AFFORDABLE CARE ACT INDIVIDUAL SHARED RESPONSIBILITY REQUIREMENT MAKING THE PENALTY AMOUNT $0. THIS IS EFFECTIVE FOR PENALTIES ASSESSED AFTER 2018.  PROGRESS TOWARD THIS GOAL IS 35%.

  4. Roll back of government regulations and Executive Orders considered to be difficult for businesses. ROLL BACKS HAVE CONTINUED. LAST WEEK THE INTERNET “NET NEUTRALITY” RULES WERE SET ASIDE. CUMULATIVE PROGRESS TOWARD GOAL: 55%

As the action happens in Washington on these 4 initiatives, don’t be surprised if the political “tug and pull” contest results in a wilder than normal stock and bond market.

We will continue to report in future issues on the progress on each initiative.

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