Supercalifragilisticexpialidocious

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by: Mark J. Grant

Just a spoonful of sugar helps the medicine go down, in the most delightful way!

-Mary Poppins

Mr. Trump ladled out a spoonful of sugar, alright, when he handed out his medicine to Congress. The boxing gloves were off; the Presidential seal glowed in the limelight. The corner may have been turned.

Then the markets voted. It is a funny thing you know, the polls are not open and yet the markets vote every day. Up 303 points yesterday, Bloomberg shows, and the DJIA is up 13.2% since President Trump's election on November 8. Investors opined, "in the most delightful way."

The Democrats can lead with Nancy Pelosi all they like. I do not say this for any political reason but for an economic one. Make no mistake, in America, people vote from their pocketbooks and if the markets' reaction to Mr. Trump continues, there may be far fewer Democrats in Congress in 2018 than there are today.

Mr. Trump, like him or hate him, is generating wealth. An IRA, a 401k, a retirement account, an Index Fund and Americans of all stripes, colors and beliefs are better off than they were before Mr. Trump was elected President. There is nothing fake about this news.

I will share with you some "fake news" headlines though, from yesterday:

Here's the real reason behind Dow 21,000 (no, it's not Trump's speech).

-MarketWatch

Treasuries are getting smashed as sellers pile on after Trump's speech.

-Business Insider

Both headlines, in my opinion, are "Bull." Equities were up because of Mr. Trump's speech and little else, the way I see things. Treasuries backed-up based upon comments from certain members of the Fed but "smashed;" hardly. We continue to remain in the 2.32%-2.51% range for the 10 year Treasury and we are still mid-range and not even close to a break-out, at this point.

I suppose these publications say these things to sell their gizmos but I have gotten very tired of these kinds of misleading comments in the Press. We all stare at the markets all day and we can see where they are, even if we have differing opinions about where they are going. Up is not down and left is not right and, as my grandmother used to say, "The higher, the fewer, the never, the less."

The Border Adjustment Tax

The border adjustment tax, which I happen to strongly oppose for a variety of reasons, I am told, late yesterday afternoon or it might have been earlier this morning, a meeting of conservative activists with White House representatives were told that the White House does in fact favor the border adjustment. The President last night went to the water's edge - didn't quite mention it, but in fact, inside the White House the BAT is winning. And to legislative games, they're [possibly Congressional leaders] going to allow votes for and against, but it's going to be part of the deal.

-Larry Kudlow, yesterday

I think it is far better than that. At the end of the day, we are going to have border adjustment in tax reform because we can't be competitive without it… I predict too that there will be improvements in that [border provision], from the original provision. We've been listening very carefully to retailors, refiners, and automakers about how you design it the right way and phase it in the right way to allay their concerns.

-House Ways and Means Committee Chairman Kevin Brady, yesterday

I think this tax is coming. It will have significant implications for many businesses. Think autos and retail and banks and drug companies and especially American oil producers. "Buy American" should be the watchword of investing these days, in my opinion.

Think "exporters" of any kind. I would begin to factor this into your strategies, whether equities or debt. I would ask yourself, "Who benefits and who loses," as you choose credits to buy or sell. The possibility of some form of Border Tax should be part of your thinking now as you place your money down on the table.

Right now, American companies are taxed at one of the highest rates anywhere in the world," Mr. Trump said yesterday. "My economic team is developing historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone. It will be a big, big cut. We must create a level playing field for American companies and our workers. We have to do it. Currently, when we ship products out of America, many other countries make us pay very high tariffs and taxes. But when foreign companies ship their products into America, we charge them nothing, or almost nothing.

-President Trump

Down in Sugarland

Doing the best we can

Holding hands

Staying up all night

Swinging stars from satellites

-Sugarland