The last month of 2024 starts today, and there are only 21 trading days for the year and 51 calendar days until Inauguration Day on Jan 20th. One central idea of the new president elect is to lower corporate taxes from the current 21% to a 15% tax rate. From the deficit perspective this proposal can be seen as suicidal, since the U.S. needs every penny it can collect to cover excessive spending, unless the newly appointed DOGE team is able to cut spending fast and efficiently to more than offset the lack of income that tax cuts represent. If the plan goes through, according to the chart below, consumer discretionary and communication services will be the sectors that will benefit the most. On average, the S&P500 index will get a boost of 4% on its Earnings per Share, and that is without taking into account the effect of deregulation, which is also supportive. The US keeps adding pressure on the government balance sheet to boost the private sector.
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