Stocks and bonds traded in a tight range for most of the week. Some stocks were rewarded, while others punished, based on their earnings results. The U.S. dollar hit a series of new yearly highs, and just about everyone is waiting for President Biden’s pick to head the Federal Reserve Bank. That announcement could come as early as this weekend. Chairman Jerome Powell’s term will end in February 2022. He is a Republican, picked by former President Donald Trump. He had a somewhat rocky relationship with the ex-president but did manage to maintain the independence of the central bank despite…
Insights & Advice
Tag: President Biden
SALT away?
High income tax states like Massachusetts, New Jersey, California, and New York would appear to be winners if President Biden’s “Build Back Better” plan is finally passed by Congress. The Trump-era limit on state and local tax deductions could provide a $200 billion (or more) wind fall for wealthy Americans. As it stands now, Congressional Democrats, especially those who represent high tax states, are crafting a change in the SALT deduction cap. Presently American households can only deduct $10,000 of state and local taxes from their federal income taxes. That cap deduction is poised to end by 2026. In a…
McConnell praises Biden
“Human sacrifice, dogs and cats living together … mass hysteria!” —Dr. Peter Venkman In a surreal turn of events, Senate Minority Leader Mitch McConnell (R–KY) praised President Biden (D) for his role in getting the Senate to pass the $1.2 trillion infrastructure bill. The legislation is called the Infrastructure Investment and Jobs Act (aka The Act). Keep in mind, McConnell had previously been vocal about stopping the Biden administration’s agenda. But infrastructure spending is typically favored by both sides of the political aisle. Talk of a bipartisan infrastructure deal has been occurring for years. It’s closer to law than it’s ever been before….
Economy grows less than expected
The good news first. The economy grew by 6.5% in the second quarter, which was one of the best quarters in recent memory. The bad news: it was a big miss. Economists were expecting an 8.4% rise, but the markets took it in stride. One explanation is that investors are well aware that the macroeconomic data is, at best, somewhat unreliable and prone to large revisions. It is not the government’s fault. The pandemic and subsequent reopening of the economy has made gathering economic data difficult. Another reason investors gave the miss a pass is that consumer spending, the biggest…
Beware the delta variant
Airplanes are full, parkways are bumper to bumper, and restaurants are packed. The summer is in full swing, and for many, the coronavirus is a thing of the past. Let’s hope it stays that way. The last thing I want to do is spoil the re-opening party. Afterall, we deserve to feel good, go out, meet family and friends without a mask, even chance a hug now and then. The one fly in all of our ointments may be the onset of an extremely contagious, and virulent coronavirus mutation dubbed the “delta variant.” You have probably read about this super…