We’re getting tax reform…
After weeks of negotiations, the Senate passed the GOP tax reform in the early hours of Saturday morning. The proposed bill now awaits a legislative compromise between the Senate and House bills before it will be placed on President Trump’s desk to be signed. Trump has acknowledged that the corporate tax cut from 35% to 20% might end up being closer to 22% once the compromise is reached. Regardless, the two biggest clauses of the tax reform, the corporate tax cut and repatriation holiday, will have far-reaching impacts on our nation’s economy in the short and long-term so this development will continue to be an important factor in the continuation of our historic bull market.
Tech stocks crashed once markets opened this week seemingly due to the unintentional consequences of the tax reform. The language of the bill might inadvertently make proposed tax breaks for intellectual property, one of the main proponents of tech companies’ value, seemingly worthless. Although bank stocks, one of the largest industries to benefit from the tax reform, were soaring on Monday, the tech sector as a whole was in deep red led by the FAANG stocks (Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX), Google (GOOGL)). Many large-cap tech stocks, however, have most of their money in offshore accounts, which will benefit from the proposed repatriation holiday. Therefore, it will be interesting to read the final language of the bill to determine whether to buy or short the tech industry before Trump’s signature finalizes the reform.
Bitcoin surpassed $16,000 during Thursday’s action as it continues to post seemingly-impossible returns to date. This will mark the digital currency’s sixth round-number benchmark since it dropped down to $8,000 following its first push over $12,000. The total market value of digital currencies has now skyrocketed over the $400 billion mark. It was reported earlier this week that the Winklevoss twins, the self-proclaimed creators of Facebook, were the first publicly-identified bitcoin billionaires.
As the cryptocurrency giant continues to post never-before-seen returns, all eyes will be watching closely to see if its meteoric rise can continue. Us at Rapunzl love cryptocurrencies, so expect big things with a Coinbase integration and crypto-trading embedded within the platform in early 2018!