De K. Matras ... q. lleva mucho tiempo siendo alcista .... continúa alcista ... y ve un futuro muy alcista .... el mercado, hasta ahora, le va dando la razón ... tanto q. ya no sé q. pensar para el futuro ... jejejjee ..... ahí os dejo el comentario
Tax Cuts Done, Spending Bill Next
The markets ended modestly lower yesterday as traders breathed a sigh of relief that the long-awaited tax cuts finally passed.
Sadly, there's been a lot of partisan bickering about whether it's a good deal or not. But politics aside and focusing just on the impact for stocks, it's definitely a win for the market.
Corporate tax rates will be cut to the lowest level in 68 years, going all the way back to 1949. It also provides incentives to repatriate accumulated profits from overseas (estimated at more than $2.5 trillion dollars).
And what will businesses do with all of those profits?
Plenty!
There's no doubt some of that will go to stock buybacks. But with the US suddenly becoming one of the most business friendly countries in the world, you will see massive new corporate investment. This includes relocating foreign operations back to US soil; building new plants to expand; and the purchase of new equipment and technology to see it all through.
All of this economic activity means more new jobs. And with more jobs comes a stronger consumer, which means more consumer spending. That, of course, is good for business, and the whole virtuous circle is reinforced, leading to decades of new prosperity.
As for the individual tax cuts, the vast majority of filers will see a benefit. And with more money in people's paychecks as early as next February, you should see already robust consumer spending increase even more. And since 70% of GDP is tied to consumer spending, that's another boost for the economy.
In other news, Existing Home Sales were up to 5.810 million units (annualized) vs. the previous month's 5.550 million and views for the same. Analysts noted this represented an 11-year high.
Both the economy and the market are looking great.
But some investors may be wondering how long this bull market can last. Personally, I see it lasting at least another 4-5 years given all of the above with the S&P doubling within that time frame. Especially since most earnings estimates have not even factored in the positive impact of these tax cuts on a company's bottom line. Once those estimates are increased, forward multiples will suddenly look cheap.
Nonetheless, the debate on whether stocks are over-valued or not continues to be talked about. And history does offer clues. To see how this market stacks up to past bull markets.
