Looks like Trump and the GOP finally won a legislative victory by passing the tax bill in both the Senate and the House. So it looks like we will have a big tax cut for the rich and the corporations and a temporary small cut for all others. The argument that Trump and the GOP put forth for these cuts are that it will spur economic growth and thus will not cause a deficit. Most of the economists and the CBO disagree with this. I am no economist but I am thinking when Bush did his tax cut, it didn't turn out so well, did it? The idea that corporations will take the extra money they saved from taxes and hire more people is wishful thinking. A survey of CEOs recently asked that question and an overwhelming majority of them did not say they will use the money to hire more workers. I think one of the things they would use the money would be to research into more automation and eventually decrease the number of employees. All the talk about outsourcing, I think automation will cause more people to lose jobs in the future. For example, if all the trucks and tractors can be driven without drivers, how many jobs will be lost?
So why is Wall Street so happy with the tax cuts. Well, most of the companies will use the money to buy back stocks. In fact that has been going on already. This has the effect of increasing the price of the stocks and line the pockets of the big investors and the executives who have stock options. It also makes the company look good. For example, if there are 1 million shares of the company on the market and the company earns 1 million dollars, the earning per share is 1 dollar. But if 100,000 share are bought back, all of a sudden the earnings per share is now 10% higher! Investors who research the company find that the earnings per share has improved, may then buy more shares and thus raise the price further. So that is why Wall Streets like this tax cut. This euphoria may go on for a year or a few years. By then Trump maybe out of office for other reasons, and he can brag that while in office, the Dow was way up and then when he is out, it crashes!
Sunday, December 03, 2017
5 comments:
Use the following html code to make a clickable link in your comment (instructions in the sidebar). You can test the link by previewing your comment.
<a href="http://angryyellowman.blogspot.com">Angry Yellow Man</a>
The above example will display as Angry Yellow Man
Subscribe to:
Post Comments (Atom)
This comment has been removed by the author.
ReplyDeleteI'm curious to hear your thoughts on all these Democrats resigning due to scandals. It's interesting to see that they Democrats are taking a supposed high road as opposed to the other side. I think politics is already dirty, so why not fight fire with fire?
ReplyDeleteWhat are your thoughts on this Jerusalem thing? Is there any hope that the city can be shared? Is it mostly a political move to have it in the holy city than in Tel Aviv?
By the way, I found this article today. I recall reading about this happening, but didn't know some of the stuff that was in the article.
https://www.nbcnews.com/news/asian-america/150-years-ago-chinese-railroad-workers-staged-era-s-largest-n774901?cid=sm_npd_nn_fb_aa
If I remember correctly, you are in California. How close are you to the fires?
Stay safe!
-LBOAYM
I think the Democrats are doing the right thing by demanding the perpetrators resign. I don't think it hurts them too much because most of the seats are in blue areas anyway. Nobody from the GOP will win Conyers' seat in Detroit, for example. It is better in the long run to do the right thing. As Jeff Flake said when he wrote a check to Doug Jones, the opponent of Roy Moore, "country before party".
ReplyDeleteThe whole Jerusalem thing is just Trump sucking up to his base. I would bet the majority of Jewish Americans are against the move. Netanyahu and Trump are the only world leaders who are for it. The whole world now agree that the U.S. is not an honest broker in the Israel-Palestinian conflict.
I have not read about the Chinese railroad workers strike before, so that was interesting. It also mentioned that the history of Chinese railroad workers are summarized in one paragraph in high school history book. I checked my kids' AP American history book and yeah, there was one paragraph. So even top Asian American students would not know most of this history!
We are in between two large fires each 20 miles away from us. So far no problem and wind is slowing down, so I think we are ok. Some of our friends had to evacuate. We will stay alert until it is over.
What happened to LBOAYM's first comment?
I went to see the filmed version of the Broadway play Allegiance, last night. It is written by George Takei and I believe it might be showing in LA right now. It's based on some of his experiences in the Japanese camps during WWII. I found the show to be pretty good and now ranks in top 3 of my all time plays.
ReplyDeleteDid you see that someone asked Roy Moore when America was great and he answered during slavery times? I'm wondering if this was fake news or if he really said that. I hope that it's fake news, but I would not be surprised that it wasn't.
-LBOAYM
I think he said that despite slavery, America was great at that time. If they claim this is fake news, then he should come out and say that while America was great at that time, slavery was a bad mark for the country and humanity. He has not say anything to that effect. He was also calling Native Americans and Asians the reds and yellows! I think he wants to rally his base with these remarks. I am sure a lot of people still think that the confederacy was the good old days. Moore is making sure these people come out to vote for him.
ReplyDelete