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taxes

The Amazon (Tesla) Controversy 

Nevada had to give Tesla tax concessions in order to induce them to put their mega-factory west of Sparks off of I-80.  Concessions are a fact of life when it comes to attracting mega-businesses to a community.  I do remember that then Governor Sandoval was criticized by some for “giving away too much” in the form of tax credits to Tesla.    I also remember asking a question in this column that went something like this: …Read More

2018 Preview and Assessment

Market valuations are high.  Current consumption is being financed by debt.  The housing data is mildly positive, but has been impacted by “rebuild” issues in the wake of natural disasters.  Corporate balance sheets are strong and laden with cash.  The world’s major economies are doing well and central banks are beginning to tighten policy led by the U.S.’s Fed.  Q4 real GDP growth looks to come in above 3% (third …Read More

2018: A Pivotal Year

Since my last blog, even more volatility has been present in the marketplace (both equities and debt spurred by the narrative that whatever tax legislation was passed by Congress would greatly benefit the economy and especially U.S. corporate profits.  In the two weeks running up to the passage of the Senate’s version of the tax bill, the equity markets moved significantly depending on how any particular Republican Senator intended on …Read More

The Risk of Recession is Rising; So is Market Risk

Recession: This is the hardest world for any business economist to pen, especially when the equity market is on a tear.  Nevertheless, that is the reality of a slow growth, deflationary world where not much negative must happen to push the 1% growth economy into negative territory.  Post-election, markets initially rose on the hopes of economic stimulus from the Trump administration.  Then, they flattened as prospects for rapid policy changes …Read More

Is Optimism a Key Ingredient in Economic Growth?

Most of the sentiment measuring surveys posted dramatically higher results after the election on optimism over what a Trump Administration might do for the economy. But, there is a big difference between hope and reality. Beginning in mid-December, the U.S. equity markets shifted into neutral, and have slowly drifted lower, perhaps waiting for the political changeover. The Fed is now in tightening mode. In my experience, the Fed tightens and …Read More

Are markets too exuberant?

Equity markets hit new highs during the Thanksgiving shortened week. Markets often move in anticipation of changes in policy. This post election market, however, appears to have instantaneously adjusted to what it perceives will be policy outcomes. Such outcomes, however, are by no means guaranteed; some outcomes may take several quarters, others years, if at all. This has been quite a stretch for markets where next month is considered “long-term.” There …Read More