Tax Bill Likely Outcomes

by Michael Keane

Now that some of the dust has settled on the new tax bill, one outcome that existed before the bill looks to be at least the same if not expanded because of the bill. Due to behavioral habits of compensation and spending, the ability to move up economically has probably been weakened by the bill. The disparity of the economic classes will likely be more apparent and more difficult to traverse. This is part 1 of a series and will provide a general outline of the forthcoming posts to support this view on the subject.

Forthcoming posts include:

1)  What was and was not included in the press briefings by AT&T and Wells Fargo after the tax bill was announced; specifically their government interests

2) How both cash and debt levels for corporations and individuals that were already at historic levels will likely continue to grow;

3) How the stock market will now be cheaper on a EPS PE basis due to the tax bill which could propel it even higher; creating higher bonuses for executives.

4) How the debt of this bill will likely go unpaid by the increase in GDP and current young generations will have to pay it back while current adult affluent groups enjoy the benefits.

Examples and data will be presented in each of the following posts.

Only time will tell if this analysis has any level of correctness.  This troublesome bill feels like a quick thank you to the president and not a bill born and solidly made through careful analysis and thoughtful integration. The bumps for labor cannot be one-offs. Otherwise the legacy of this bill will not shine down favorably.