Displaying items by tag: congress
Many advisors may not have realized it yet, but the new COVID relief package passed by Congress recently has many benefits for upper middle class Americans and even those in the mass affluent category (which constitute tens of millions of clients for advisors). Other than the $1,400 checks, there are also two lesser known details advisors need to be aware of. If a client qualified for a check last time, but did not get one, they can claim the money they would have been entitled to as a credit against their taxes. It is a bottom line deduction that comes directly out of taxes owed. If no taxes are owed, they should get the credit as a refund check Additionally, the package offers enhanced child tax credits. This is $3,600 per child under 6 years old, and $3,000 per child between 6 and under 18 years old. The latter used to be for those under 17, so this helps those with 17 year-old children. Finally, those who have student loans that will be forgiven will not have to pay taxes on the forgiven amounts, which is a massive benefit for those who qualify.
FINSUM: There is a lot more to this package than many realize. Advisors should take a deeper dive to see what applies to their clients.
On Friday we ran an article covering which sectors and stocks would do well if the Republicans swept the election. Today we are doing the opposite side of that coin—the stocks that will win big if the Democrats sweep. Democrats are currently leading in the presidential poll and seem likely to keep ahold of the House, while the Senate looks like much more of a stretch. That said, if a sweep happens, infrastructure may be a key sector to surge as a large infrastructure bill would seem likely. Other sectors likely to gain are renewable energy, semiconductors, consumer staples, and oddly, gun stocks (since sales will likely surge on fears of regulation).
FINSUM: The infrastructure play seems like a good one, semiconductors also (like Western Digital). We still think a more likely scenario is a split Congress.
COVID Loan Tracker, a union of over 17,000 small business owners representing billions of dollars in Paycheck Protection Program applications, demands that the federal government increase the funding for PPP to $1tn within 48 hours.
The first round of the Paycheck Protection Program has proven that the initial conception of the distribution of funds was flawed from top to bottom. The program has done very little to help genuine small businesses and instead has benefited large companies who have used subsidiary entities to benefit disproportionately and unfairly. The examples abound. Banks have incentivized large and important customers—those who need PPP money least—at the expense of the backbone of the nation: genuine small business owners, or those who run “small” small businesses and are an intimate part of the communities they inhabit and serve. These are the people whom the program was designed to protect, and those whom have been most failed by it. 93.3% of US small business owners have received no money from the first phase of PPP, amounting to 28,000,000 businesses. This is a wrong that must urgently be made right.
In addition to increasing funding to $1 tn, we propose the following rules:
1. 50% of the total dollars funded through the program must go to businesses with 50 employees or less (with the employee count taken as of February 15th, 2020)
2. The next 25% of the total dollars funded through the program must go to businesses with less than 150 employees (with the employee count taken as of February 15th, 2020)
3. The next 25% of the total dollars funded through the program must go to businesses with less than 250 employees (with the employee count taken as of February 15th, 2020)
4. Businesses with less than 50 employees will have their applications processed first, with applications for funding larger businesses only being approved once the full 50% has been allocated to those businesses with less than 50 employees.
5. Any remaining funding that exists after these disbursements will be allocated to those businesses with less than 50 employees.
6. No entity with any ownership association to any business with more than 250 employees may be given funding.
7. Every lender which takes part in the Paycheck Protection Program must make every effort to process and disburse all loan applications within 14 days of application receipt. Those lenders which are found to be routinely in failure of this standard shall have their processing fees reduced by 50% at a minimum.
This plan will ensure that the small business owners who need this money most—the smallest of small business owners—will get the funding they deserve. These small businesses are the heart and soul of every village, town, and city in this nation. What will our country become if we fail them?
Please back our proposal and help genuine small business owners.
Duncan and Rita MacDonald-Korth
Small business owners and founders of COVID Loan Tracker
Trump’s legal team put out a bold proclamation today. In a 171-page briefing that preceded the launch of his impeachment trial in the Senate, Trump’s lawyers argue that he cannot be removed from office for abusing power. They contend that since he did not break any laws, he cannot be removed from office. The team summarized their view, “House Democrats’ novel theory of ‘abuse of power’ improperly supplants the standard of ‘high crimes and misdemeanours’ with a made-up theory that would permanently weaken the presidency by effectively permitting impeachments based merely on policy disagreements”.
FINSUM: This is a very interesting argument as the legal team seems to have changed tactics. Rather than arguing the underlying facts in the case, they are now trying to say that even if all the facts are true, Trump still cannot be removed from office.
The Democrats are finally getting their time with Robert Mueller this week. Mueller is set to testify for a full five hours before the House Judiciary Committee and House Intelligence Committee on Wednesday. Democrats are seen as likely to push him to give further details on his investigation, especially into obstruction of justice claims, while Republicans are expected to probe him on bias within the FBI.
FINSUM: Everyone seems to agree—it is hard to imagine anything happening at these hearings that would change anyone’s mind.