We are 6 months into the new tax structure. Results are starting to emerge in terms of what corporations and individuals are doing with their new tax savings. A series of blog posts was written about possible results earlier in the year. They can be found individually below:
- Part 1 - Likely Outcomes
- Part 2 - Corporate Responses
- Part 3 - Earnings
- Part 4 - Debt Load
Former Federal Reserve Chairman Ben Bernanke recently wrote an article on the topic. The link to the Bloomberg article is here.
There are some items that are becoming clearer now that the second quarter is coming to an end.
- Cap Ex is losing the battle against buybacks and increased dividends
- Earnings have increased, supporting stock prices
- Debt load is not looking to decrease
- Because the decision making of how the tax bill benefits would be distributed was given to the top, the advantages up to this point are clearly staying at the top.
** This blog is used for opinions and ideas and should not be used as a direction to act without doing your due diligence.**
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