DOW is flat since the Trump tax cuts went into effect

[Johnny2X2X]

January 2nd of this year is when the Trump tax cuts went into effect, this was supposed to be the beginning a huge growth era for investors. If you invested $1000 in the market on that day because you just knew Trump was going to deliver, today you'd have $1009.60. Congratulations, you just made $9.60

You could have made 3 times that in a CD.

So if/when relatives talk about the markets over Turkey this week, know that the market is flat since the tax cuts went into effect. And job growth is slower too. Trump road the Obama economy into 2018 and it's been stuck in neutral since.

[TheBlackAdder]

1. Flat, just like the earth. Coincidence? I think not! :-D

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Trump era. That's when a lot of the crazy flat earthers emerged and started to make noise.

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[Johnny2X2X]

2. I hope the media starts covering this

You know for a fact they'd be talking about it 247 if the markets had risen by 10 or 15% since the tax cuts went live, absolutely need to discuss it now too.

Why did the tax cuts kill investor value growth?

[kurtcagle]

6. It was already fading

Early stage investment has been drying up for a while. I work in AI. A couple of years ago, if you put the words Artificial Intelligence or Blockchain into your business name, you'd have investors lined up a mile deep. Today, everyone's sitting on their hands, and most of the startups begun in the last few years will be worthless paper in three years time. I'm hearing that scenario playing out in a number of different "hot" sectors. A lot of businesses took that windfall and used it to buy back stock, and I expect that the hissing sound you hear in the background is the sound of investors desperately trying to sell their stocks before a stampede out of the equity markets make their paper worthless.

[BritVic]

3. It took 8 years for Dubya to run the US economy into the ground

...Twitler is going to manage it in 4.

[Johnny2X2X]

4. More like 1

The 2017 economy was Obama's, his policies and tax rates held for the year, the economy that resulted was his. 2018 is the Trump economy, it's the first year of it and it's headed in the wrong direction.

[kurtcagle]

5. GDP Jumped 2018Q2, then fell in Q3

Annualized GDP popped up to 4.3% in the second quarter of this year, after growth of 2.2% in 2017Q4 and 2018Q1, then diminished to 3.3% in 2018Q3. My sense is that 2018Q4 will be back down around 2.3%, and will likely be anemic to negative through 2019. If I had to make a guess, this delayed a recession that I was expecting to hit around now by about six months, but has also increased the likely severity of the recession when it does hit in 2019Q2.

As to the market - it hit a first peak on January 23, 2018 at around 26,200. It's been range bound after that, making a brief foray into a second peak at 26,818 in October. At the moment it's just broken below the 25,000 mark, meaning that the DJIA has lost about 7.5% of its value in the last month from the peak, NASDAQ's flirting with bear territory at 10%.

Its worth noting that Trump inherited the second longest bull market in history. This bull is geriatric, and it is likely that Clinton would have had to face its demise earlier this year if she had been elected. Recessions are a reality - they are a lot like wildfires in that regard in that they eliminate a lot of malinvestment and ultimately free up capital. However, the longer they go on, the more severe their effects. They also tend to ping pong between equity recessions (such as the recession in 2001) and bond recessions (the housing recession of 2009). This one will be an equity recession that will hit tech stocks hard and retail nearly as hard, though with the economy already weakened by tariffs I'm also expecting it will hit agriculture and manufacturing far more than it would have otherwise. It'll also be a consumer credit crunch, which is one reason that people should be clearing up their credit card balances now while they still can, because already high credit card rates will likely skyrocket in that scenario.

[Johnny2X2X]

7. The tax cuts were not necessary

The economy was motoring along pretty well, Trump wanted to put his stamp on it with the tax cuts. They did not hurt the economy as much as they delayed the coming recession. But what they did do is spent one of the most effective bullets in the President's gun when it comes to fighting the recession. It will mean a deeper recession.

I agree, the economy is cyclical, the best a President can do is reign it in a little when it looks like it's heating up too much and then stimulate it when recession hits. Slow and steady is the way to go.

And the tariffs are going to compound things like you said. Basically, with responsible leadership we might have seen a mild recession in late 2018 that ended in Q2 2019. Because of the actions of Trump and his enablers, we'll likely see a much deeper and longer recession.

And we're running a $Trillion deficit in a good economy, that number could double in a severe recession.

One thing about these clowns in charge right now, is they will have no clue what to do when things head south. Trump will do nothing and instead try to blame everyone else.

[onethatcares]

8. to it the soup and nuts of this.

for myself and I won't blame you if you're mistaken, would this be a good time to sell a house, take the cash, buy another with part of that cash and just hang on for the ride. Asked by a 70 y.o. couple in that scenario.

Thanks.

[Johnny2X2X]

9. No one knows for sure

At 70 you should be in low risk investments entirely.

As far as a home... I know a guy, young and married with his first child being a year old. He bought his home at the depths of the housing crash, got a steal and paid double payments for 10 years to build even more equity. His house wasn't even up for sale, but he was getting regular calls from realtors asking if he'd sell. He was in a very desirable neighborhood. Finally he listened to one of them and the guy presented a cash offer for $200K more than they owed on the home. He took it and he and his wife are moving in with his parents for the next year or so, so they can help with the baby. He's counting on the housing market crashing and he can then walk into it and pay cash for a house.

If you're retired, do you want to downsize your home anyway? Downsizing right now might be a prudent movee.

Everyone is looking for ways to time the market, it's not easy.

[IronLionZion]

11. Invest for income

think bonds, savings, dividend paying mutual funds, etc. Be diversified. It could be a good time to sell your house if you're planning to downsize for retirement. My parents are selling theirs and moving to Florida for retirement.

Forget about seeing much growth from equities at this stage in your life with this idiot in charge of our economy.

[IronLionZion]

10. Tax cuts are making things worse

Because it's stimulating the wrong sectors of the economy that were already doing well, so many wealthy investors have taken their gains and sold high.

The Fed has had to gradually raise interest rates to avoid inflation, and will keep raising the rates. This makes bonds more attractive investments.

Deficits are soaring, and there will be less tax revenue to combat the next recession.

Republicans will use deficits as an excuse for austerity, which is proven to damage the economy by taking money away from people who need it the most.

Dipshit's trade wars and tariffs are hurting America's exports. China has been selling their massive stockpile of US treasury bonds.

Dipshit's racist immigration policies and travel bans have spread anxiety to a large portion of Americans who are affected or know people who are affected, and would instinctively save money instead of investing.

I could go on.

[Johnny2X2X]

12. He is clueless

The bottom line is that Trump is a clueless idiot. There were plenty of people telling him that his tax cuts, as designed, were a bad idea. And even more telling him that his tariffs were a terrible idea.

When a recession hits, he and the GOP will do everything you aren't supposed to do in a recesssion and the results could be catastrophic.

[Gore1FL]

13. It is, but I suspect the flatness is probably more due to the trade war. nt

[ck4829]

14. Kick