Maybe I'm a little late to this party, but Trump paid only $750 in taxes for two consecutive years? The supposed billionaire? I know there are a lot of way to play the tax game, but at some point your revenues are so large that taxes become necessary. The way Warren Buffett avoids taxes is by having his "wealth" separate from his "revenues". He's wealthy because he owns and never sells Berkshire stock. But is "only" paid $100,000 or whatever in salary. It's a simple, legal setup that passes the smell test.
Trump on the other hand collects rent and royalties and other fees. He can use depreciation and interest deductions among other tools...but at some point, he has to sell the property and roll it into a newer, higher prices property to keep up the depreciation game - which would require capital inflows - or he would have to pay taxes.
The best take I saw on the situation was from GoCurryCracker.com's author who believes it looks like a money laundering scheme. And he's a detail-oriented tax specialist - having authored many in-depth tax avoidance articles. If he's smelling money laundering, I'm a believer! That passes my smell test...
Markets are pointing to a green open - which is good as I'm 10% net long this morning. It seems we just got tired of selling, though the "reasons" we're up are few and far between.
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1) I think this is what zombie banks look like - ECB rates vs. Euro bank index
2) He's the US version - Fed vs. XLF. "One of these things is not like the other one."
3) Market performance relative to Presidential elections - chop before, rise after.
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My plan of attack today is to tread lightly, reducing my trade sizes on day trades, and watching the Vix like a hawk in case there's a reason to get longer or cut exposure.
That ECB and Fed vs. their respective banks chart is really gnawing at me. Why have our bank stocks done so much better? Is it the "Jim Cramer" and CNBC effect? Are Americans smarter? Dumber?
As a former globetrotting stock analyst, I'll say that Europeans tended to use math and look at balance sheets and project flat futures - not pricing in unknown, unannounced growth projects...whereas US analysts tend to ignore balance sheets and project upside into the stock prices from "likely" but unannounced projects.
Now, the US investors are usually "right" in terms of companies winning new projects and continuing to grow. But if growth and projects disappear, US investors eat the downside. Whereas the Europeans price in the downside and get upside surprise.
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