Hope you had great Thanksgiving. Lot of interesting events have happened in last two weeks so its time to look at some of these - especially on two topics we have visited in past - Taxes and Bitcoin!
Unless you are on different planet, you may have heard that Trump and GOP are working on tax cut plans to reward big corporations and their rich donor friends. As college students are getting ready for their finals in next 2 weeks, GOP finally did one night-out (almost) to get something done. They passed almost 500 page (some of that is hand-written) tax reform in senate. Now house and senate need to sort out their differences and vote on final bill. President Trump is going to push his party leaders to get it done before Christmas so that Trump can claim that he had given "Greatest Christmas Gift EVER to American People" for holidays. Watch out @realdonaldtrump twitter feed for such claims! Who benefits from these tax reforms? Check out my earlier blog regarding this. I would suggest there is still time to fix some of the "bad" and "ugly" aspects of this bill - only if some of the GOP members have will to address these aspects and really push for tax cuts for everyone (including CA, NY, NJ residents). One thing is for sure - in 2017 GOP and Trump did not had any legislative win. So they need this and they are going to get it done!
Now coming to "Bubbly" Bitcoin! It has reached almost $12000 in just matter of days. This reminds me of nineties dot.com bubble where adding .com used to boost market valuations by hundreds of millions. Some companies have started doing same by adding "coins" or "blockchain" to their strategy and boom - unsuspecting investors are rushing into "fools' paradise" by buying into these. As I have written previously, there is fad, fraud and new frontier of investing in cryptocurrency world. By one of the chart I have seen, Bitcoin is third biggest bubble (# of days to rise in price) in all known history of bubbles. Is it ready to burst? Don't know. Bubbles can get lot bigger before hot air comes out. Bitcoin may cross $15000-20000 but in the end this bubble will burst and it will have crash landing! Bitcoin total market valuation is more than 475 S&P companies! When its valuation starts approaching top 10 S&P companies, it would have reached "bubblical" proportions! So my advice - just watch out and don't gamble!
It's different story for stock markets - while markets are at all time highs and crossed the year end targets I predicted in Oct, they would keep at these levels for some time due to synchronized global GDP growth, US tax cut bill and healthy corporate earnings! We may see DOW at 25K, S&P at 2700 and Nasdaq at 7000 in early 2018. Two sectors in particular are still very promising for investing - Energy (XLE) and Financials (XLF).
Finally something I personally liked. The wonderful, light hearted movie "WONDER" I would recommend watching with your kids. Wonder is an earnest, funny and emotional family drama with a subtle message of kindness (which we all need in this world). All kids acted very well. Jacob Tremblay played Auggie so well that he deserves an Oscar nomination!
Unless you are on different planet, you may have heard that Trump and GOP are working on tax cut plans to reward big corporations and their rich donor friends. As college students are getting ready for their finals in next 2 weeks, GOP finally did one night-out (almost) to get something done. They passed almost 500 page (some of that is hand-written) tax reform in senate. Now house and senate need to sort out their differences and vote on final bill. President Trump is going to push his party leaders to get it done before Christmas so that Trump can claim that he had given "Greatest Christmas Gift EVER to American People" for holidays. Watch out @realdonaldtrump twitter feed for such claims! Who benefits from these tax reforms? Check out my earlier blog regarding this. I would suggest there is still time to fix some of the "bad" and "ugly" aspects of this bill - only if some of the GOP members have will to address these aspects and really push for tax cuts for everyone (including CA, NY, NJ residents). One thing is for sure - in 2017 GOP and Trump did not had any legislative win. So they need this and they are going to get it done!
Now coming to "Bubbly" Bitcoin! It has reached almost $12000 in just matter of days. This reminds me of nineties dot.com bubble where adding .com used to boost market valuations by hundreds of millions. Some companies have started doing same by adding "coins" or "blockchain" to their strategy and boom - unsuspecting investors are rushing into "fools' paradise" by buying into these. As I have written previously, there is fad, fraud and new frontier of investing in cryptocurrency world. By one of the chart I have seen, Bitcoin is third biggest bubble (# of days to rise in price) in all known history of bubbles. Is it ready to burst? Don't know. Bubbles can get lot bigger before hot air comes out. Bitcoin may cross $15000-20000 but in the end this bubble will burst and it will have crash landing! Bitcoin total market valuation is more than 475 S&P companies! When its valuation starts approaching top 10 S&P companies, it would have reached "bubblical" proportions! So my advice - just watch out and don't gamble!
It's different story for stock markets - while markets are at all time highs and crossed the year end targets I predicted in Oct, they would keep at these levels for some time due to synchronized global GDP growth, US tax cut bill and healthy corporate earnings! We may see DOW at 25K, S&P at 2700 and Nasdaq at 7000 in early 2018. Two sectors in particular are still very promising for investing - Energy (XLE) and Financials (XLF).
Finally something I personally liked. The wonderful, light hearted movie "WONDER" I would recommend watching with your kids. Wonder is an earnest, funny and emotional family drama with a subtle message of kindness (which we all need in this world). All kids acted very well. Jacob Tremblay played Auggie so well that he deserves an Oscar nomination!
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