Displaying items by tag: congress

Friday, 22 February 2019 11:45

Real Trump Fireworks are About to Begin

(New York)

Next week is going to be a media circus, as the odds of real Trump fireworks look likely to surge. The reason why is that Michael Cohen is going to testify at an open public hearing before the House Oversight Committee next Thursday. The committee, seemingly defending its actions, commented that “Congress has an obligation under the Constitution to conduct independent and robust oversight of the Executive Branch, and this hearing is one step in that process”. The questions Cohen will answer will concern hush money payments, potential Trump conflicts of interest etc, but will not touch on Mueller’s probe into Russian interference.


FINSUM: No matter how you feel about Cohen, or whether you think this is just political theatre, the odds of a media bombshell, true or not, seem high.

Published in Politics
Monday, 12 November 2018 12:09

A New Fiduciary Wave is Sweeping the Country

(Washington)

One aspect of last week’s midterms that is not being discussed much, but has critical relevance for the wealth management industry is that fact that statehouses across the country swung from red to blue. Democrats won control of several state legislatures and governor seats across the nation. The impact on advisors could be large, as many more states are now much less constrained in their ability to urge for, and issue, their own fiduciary rules.


FINSUM: The massive “blue wave” did not materialize, but the gains were substantial enough that they could create some serious headaches for advisors that are in swing states. Perhaps even more concerning is how the blue House might push for a renewed federal fiduciary rule.

Published in Wealth Management

(New York)

The market had a relief rally right after the election results came in. Yesterday wasn’t so good. The big question on everyone’s mind is where the market is headed from here. Looking historically, the current political arrangement (split Congress, Republican presidency) is the worst for markets. The S&P 500 has had the lowest returns in the current political set up, though it has only occurred four times since 1900.


FINSUM: The market’s outlook for 2019 appears fairly bleak to flat for us. The main reason why is that there won’t be another major tax package, and the great earnings of this year will make 2019 comparisons look weak. Growth is also likely to slow.

Published in Eq: Total Market
Wednesday, 07 November 2018 12:37

Why the Midterm Result Will Be Great for Stocks

(Washington)

The midterms are finally over, and with it the possible end to the volatility of the last month. Many on Wall Street now say stocks are ready to gain as buying fever takes over. The election went almost exactly as expected, which has set up a possible goldilocks scenario for markets. With Congress split, it is likely that policy gridlock will take over, a situation many think is ideal for stocks. The idea is that the less government does, the more room the market has to operate uninhibited.


FINSUM: The key here is that a split Congress means there likely won’t be any huge policy changes over the next two years. That seems favorable for stocks given the political uncertainty over the last 24 months.

Published in Eq: Total Market
Wednesday, 07 November 2018 12:36

How the Midterms Will Reshape Muni Bonds

(Washington)

This midterm election might have ended up being very consequential for muni bond markets. Some in the muni market feared the possibility of the Republicans maintaining control of both the House and Senate because of how further tax changes could have hurt the finances of municipalities. However, now that Congress is split, the outlook seems more favorable. The reason why is that Congress now looks more likely to restore a tax exemption for a debt refinancing strategy that is often used by local governments.


FINSUM: Just like in other asset classes, having a split Congress looks favorable for munis.

Published in Bonds: Munis
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