On November 16, 2016, just a week after he won the election, Donald Trump went out for steak. Not just any steak, either. The president-elect took his family to New York’s exclusive 21 Club, ditching the press pool to enjoy some privacy.
At the restaurant, surprised diners greeted Trump with applause. We know this only because a Bloomberg reporter happened to be dining there and captured video on her phone.
Trump’s response, unaware he was on camera: ‘We’ll get your taxes down, don’t worry about it.’
Many investors still assume a big tax cut is coming. That, plus promises of infrastructure spending and deregulation, set off the ‘Trumpflation’ trade following the election.
Trumpflation sort of made sense back in November, but I don’t think it does now. I think we won’t get any tax cut at all – and if we do, it won’t be bullish for most stocks. (Though Robert Ross and I have some suggestions for likely stock winners in our premium service, Macro Growth & Income Alert.)
In other words, we’re going to lose either way.
Blown-Up Deficit
The tax reform wish list the White House unveiled last week isn’t exactly a ‘plan.’ It’s more like an outline, minus the details.
Still, the goals are clear enough: Trump would reduce almost everyone’s federal tax burden and make the system somewhat less complicated.
Objections fall into two categories:
This post was published at Mauldin Economics on MAY 2, 2017.
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