allright, so news for any fags here who don't spend all their time jerking off to the crypto currency bubble. Trumps new tax reform he's trying to implement is going to dramatically lower corporate taxes giving them more capital to grow their businesses, if his Tax reform passes then the S&P500 will grow significantly, plus if we collectively put a significant amount of money into the S&P500 then the companies within it will have even more money to grow. If you haven't invested in the S&P500 yet then do it now before you miss this oppurtunity, if you have then i'd say double down.
Even if Trumps tax reform doesn't pass, the S&P500 has never had anyone lose money over a 20 year holding period so don't sell if you lose money, you'll profit eventually and you'll continue to get dividends over those 20 years (which you should be reinvesting). Come on Veeky Forums you can't lose with this one
You know, I keep seeing people talk about this, even in the media. At what point do people stop to realize that the reason why stocks started shooting up November, 2016, was because of the EXPECTED benefits of tax reform and infrastructure spending?
Markets price in expectations before they happen. There are many traditional general market indicators now showing equity markets to be getting ahead of themselves.
At this point, those tax reforms better turn US business earnings into something very special in order to continually justify these elevated price levels (which were exacerbated by Trump's victory, to begin with). And there are other factors at play, particularly with the Fed moving towards becoming more strict on rates and started to reduce their balance sheet.
Fundamentals have become less important over these past 9 years, and I feel they went completely out the window last year. People just buy things that "cheap", or just buy a dip. Nobody has to be selective anymore, and this leads to passive funds doing very well.
Jaxson Sullivan
I don't have a bearish bias, btw. But as a trader you're on the frontlines and notice this sort of shit happening.
The author is wrong about several things though: >The combination of a better economy, a rising stock market and a tighter Fed should mean a stronger dollar, but that is not how the currency has performed this year
That's been happening because economic data didn't show any justification for a rate hike so the market prices in expectations of no rate hikes through selling off the dollar index. And even Yellen said they'll likely go ahead with the December rate hake, even if inflation doesn't reach that 2% level, because rate hikes are thought to have a lagging impact.
>What would really worry me would be an inverted yield curve, but there is now almost an eighty basis point spread between the two-year Treasury and the ten-year.
Again, hard to make any calls from the Yield Curve because treasuries have been impacted by, again, expectations from whether or not there will be rate hikes.
The important thing to understand that yields from investments lower as prices rushes ever upward. And there are other things, besides stocks, that start to look more tempting, when all equity markets do is continually up (while fundamentals don't change at the same pace).
A paper which goes in detail into how the money from Quantitative Easing seems to have mainly gone into pumping the stock market (I'm a strong believer of this view, and it explains my 'Fundamentals have become less important over these past 9 years' comment), and may have not had the desired impact on Aggregate Demand driven GDP/ Inflation.
Jacob Murphy
Also, I may not have a "bearish bias", but after reading this aeticle that was poster here: equity.guru/2017/08/02/millennial-investors-flood-stock-market/ about millennials starting to become more involved in the stock market, well...I think it'd be awful nice to not make them buy into an elevated market. They're already so loaded with debt, as it is.
But market's gonna do what it does, just my opinion, I guess.
Joshua Nelson
Good posts
Carson Murphy
I work at a movie theater, good thing the executives who play golf and have a salad bar and a crocquet set at their headquarters are gonna get a tax cut, they must be starving over there.
Meanwhile our theater is disrepaired, understaffed and the rollover rate is 3 weeks.
Brandon King
People who think changes in corporate tax will encourage businesses to spend have obviously never owner a business. And it has zero effect on small businesses because they don't pay corporate tax anyway.
Businesses spend money when taxes are HIGH not low. When profits are high and taxes are high businesses spend to intentionally decrease their annual profit. When taxes are low that is when people want to show high profit because they can actually keep their money then .
Nathan Long
never EVER talk about MY TRUMP like that again. you don't know Veeky Forums... we've got ways of making you pay, kike degenerate (did you know the Jews are the cause of all degeneracy? probably not since you're brainwashed by them into not liking trump)..... *unsheathes katana* did you know that the country second to America.... Japan... Made swords that can cut through steel....... theyre folded one million time, that means they can cut through libtards like you like butter........ *teleports behind you* I hate you almost as much as I hate women... nigger faggot. may kek have mercy on you....... *slices you* heh, looks like your fake news now... that's what you get for messing with Veeky Forums.. were legion. nothing personell, cuck
Aaron Sullivan
This tax cut is already priced into the stock market.
And not Veeky Forums meme, crypto priced in, I mean actually priced in, that's why it has risen so much since Trump got elected.
Now on the other hand, if tax reform doesn't go through or looks like it won't go through, then we're gonna have one hell of a correction.
Nathan Foster
Most of the main S&P entities are already sitting on piles of cash.
The problem is lack of business opportunities to entice investment.
Christopher Allen
"the S&P500 will grow significantly"
Wow grandpa, 12% gains this year instead of 8? Amazing!
Bentley Baker
Pass I rather make monster gains that are also tax free what s time to be alive
Luis Edwards
>millenials You realize 80% of Veeky Forums are millenials, right?
Samuel Wright
>lower corporate taxes giving them more capital to grow their businesses
While a cut to corporate tax rates defintely increases net income for a company, there's little to no evidence that that money is reinvested into new markets or improvements in labor force. It's more often then not, translated into automation.
>At what point do people stop to realize that the reason why stocks started shooting up November, 2016, was because of the EXPECTED benefits of tax reform and infrastructure spending?
The stock market has been going up at relatively the same pace since 2010. There's no evidence for a Trump bump at this time and if it does happen it'll be 12-18 months until we actually see the impacts of capital movements on stock price (spending money on reinvestment is a lagging indicator).
> Nobody has to be selective anymore, and this leads to passive funds doing very well.
This is extremely true. It doesn't pay to manage individual stocks anymore when all stocks are on an upward trend.
Logan Lee
>Trumps new tax reform he's trying to implement is going to dramatically lower corporate taxes giving them more capital to grow their businesses, if his Tax reform passes then the S&P500 will grow significantly already priced in.
Blake Cox
People aren't fucking irritating kids (who ruin boards with low effort threads) forever :)
Charles Brown
>buy into the stock market >buy at ath >market crashes every 8 years regularly >market hasn't crashed in 8 years >buy the massive boomer bags >please millennials
Face it gramps, you are going to be buying my crypto bags when the stock market crashes in the next year or two.
Colton Hughes
The stock market rallied when he won,it's also continued to rally on mentions of tax reforms. It also experienced upward movements for other events this year, like Macron winning the first round in the French elections. I know, I was trading them.
Elijah Price
Trump even made posts on social media about the markets rallying after he won. Earnings has also caused the upward movements, but to say it wasn't impacted is wrong,
Luke Gutierrez
>buying just before a correction Look, kid, if you didnt bet on Trump pre-election then double or nothing when he won you fucked up.
Now its pretty obvious he wont get to pass anything without giving ground, this causes corrections.
Dylan King
>buying at the worst possible time
Zachary King
Isn't it just buy the rumor, sell the news in its most massive form? Will there be a contraction once the bills are passed?
Joshua Bailey
Tax reform is all noise, there's barely any cut for most people.
Hudson Lewis
It's believed that this will could have a longer term impact on the economy, so people won't sell based on it finally occurring.
Certain indicators do show the US economy growing, but the question is whether or not that growth is realistically accounted for, in general market prices.
It's also human nature to buy when things are rising, and this can further distort what "true market price" should be.
I'll say this over and over again though. Yield plays a huge role in how people determine where to place money. If stock prices continue to get ahead of themselves, with the Fed increasing returns on debt, start to get worried. And, to be honest, I'd be getting worried if the Fed can't really find any justification for further rate hikes, because that would mean something's up in the economy.
Jace Harris
But the milenial generation stays the millenial generation forever. Even wehn we grow up, we will stll be the generation born between 1985 and 2000.
