Assessing Trump and Harris policy … the tradeoff between higher inflation or higher taxes … a string of triple-digit trading wins this summer Would you prefer your money be stolen by inflation or taxes? If you read forecasts by economists, that appears to be the tradeoff between a Trump presidency and a Harris presidency. Beginning with Trump, the going logic holds that his proposed tariffs, deportations, and tax cuts would reignite inflation. Here’s Reuters: The Federal Reserve’s battle to get inflation under control likely faces fresh challenges should Donald Trump regain the White House, a dynamic that could put the U.S. central bank back in the former Republican president's crosshairs.
A wide range of economists see Trump's tariff agenda, coupled with aims to deport millions of undocumented workers and the likelihood of expanded deficits, reigniting price pressures that are now easing and likely driving the Fed to react with more restrictive monetary policy than is now penciled in. Trump has proposed new tariff hikes of 10% on all imports and 60% on Chinese goods. Some economists forecast this would result in an inflation bump. The non-partisan Peterson Institute for International Economics estimates this tariff policy would translate into an estimated $1,700 a year in additional costs for a typical middle-class household. Trump has even floated eliminating the federal income tax altogether in favor of tariffs on imports. This would likely be felt as a regressive tax with middle- and low-income households feeling it the most. Meanwhile, a mass deportation of immigrants would presumably remove a large percentage of the unskilled labor pool, likely driving up labor costs. It’s safe to assume corporations would try to pass those higher costs through to consumers via higher prices. Finally, the tax cuts that Trump has floated are a form of fiscal stimulus. He has suggested lowering the corporate income tax rate from 21% to 20%, while also making the individual, estate, and business tax changes from his 2019 Tax Cuts and Jobs Act (TCJA) permanent. More money in consumers’ pockets is likely to result in higher spending in the economy, which is inherently inflationary. So too are higher prices from tariffs and labor-cost-increase passthroughs. So, though Trump has pledged to end our “inflation nightmare,” it’s unclear how his proposed policies would accomplish that. | ADVERTISEMENT  If you have any money in AI stocks like Nvidia, Microsoft and Google…
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Click here. | Meanwhile, if Vice President Harris is elected, it’s safe to bet on higher taxes hitting you in one way or another Where Harris stands on many issues isn’t entirely clear yet, so we’ll borrow from her policy positions when she sought the Democratic nomination for president in 2020, and when she served as a senator from California. For corporations, Harris has proposed returning to a 35% tax rate. This is higher than Biden’s fiscal year 2025 budget that would take it up to 28% from today’s 21% rate. For individuals, Harris wants to raise the income tax rate on the top 1% of earners from 37% to 39.6%. Meanwhile, it’s unclear whether she’ll abide by Biden’s promise not to raise taxes on individuals earning under $400,000, but it’s unlikely. This is because one of Harris’s platforms in her 2020 run for president was a version of Medicare for All, financed by a proposed 4% tax on family incomes above $100,000. During that run, she also proposed expanding the estate tax, raising capital gains taxes to be taxed as ordinary income, and imposing a “financial transaction tax,” on stock trades at 0.2%. Meanwhile, trillions of dollars’ worth of tax breaks will expire after next year unless Congress votes to extend Trump’s Tax Cuts and Jobs Act that took effect back on Jan. 1, 2018. It was the largest overhaul of the tax code in three decades. It’s unlikely Harris would fight for its extension as it stands. So, you might experience a tax increase by default. Now, a Harris presidency would not come without some risk of additional inflation. A few potential sources of higher prices include: - Rental caps: Harris is also on board with Biden’s call to cap rent increases by 5% on landlords with 50 or more rental units. While this would help the tenants on the receiving end of the cap, price controls are inherently inflationary, as they disincentivize new development, which impacts supply/demand and ultimately, prices.
- Student loan forgiveness: Harris has promoted Biden’s historic student loan forgiveness policies, which is basically free money, which is stimulative.
- Tax credits: In her 2020 presidential run, Harris proposed tax credits for rent payments made by renters making less than $100,000 who spend more than 30% of their income on rent and utilities. Again, such a “free money” program has an inflationary impact.
So, which one of these two delightful options would you prefer? Regardless of who wins the White House, our government’s financial situation continues to deteriorate. Here’s where we stand looking forward, from the Committee for a Responsible Federal Budget: During the next presidential term, the national debt is projected to reach a record share of the economy, interest costs are slated to surge, the debt limit will re-emerge, discretionary spending caps and major tax cuts are scheduled to expire, and major trust funds will be hurtling toward insolvency.
Adding trillions more to the national debt will only worsen these challenges, just as both Presidents Trump and Biden did during their terms along with lawmakers in Congress.
The country would be better served if the candidates put forward and stuck to plans to reduce the national debt, secure the trust funds, and put the budget on a sustainable long-term path. Instead, this meme sums up where we are today:  Before we sign off, let’s end on a positive note by highlighting a fantastic way to help overcome high inflation and/or high taxes Perhaps the best way to offset the respective financial weights of Trump inflation or Harris taxation is by making more money – preferably, lots more money. With this in mind, I need to congratulate Jonathan Rose’s Advanced Notice subscribers. Here’s why… - On June 11, they closed an ING put for 102%.
- On June 12, they closed an AI call spread for 463%
- On June 13, they closed a PENN call for 126%
- On June 25, they closed a ENVX call for 166%
- On July 17, they closed a WULF call for 132%
- On July 22, they closed a CRTO call for 245%
- On July 24, they closed a CRDO call for 99%
- On July 24, they closed a UPST put for 100%
To be clear, there were some losing trades in there as well. Jonathan would be the first to highlight them, as all traders navigate both wins and losses. However, the wins dwarfed the losses, netting out to a recent close-trade average return of 65%. | ADVERTISEMENT  Investing experts Louis Navellier, Luke Lango, and Eric Fry just revealed brand new AI research and 9 AI stocks that could soar in price starting today. If you want the chance to make a lot of money from phase 2 of the AI Revolution, these 9 stocks could be your best shot.
Click here. | Stepping back, for newer readers, Jonathan is a trading veteran who’s pulled millions out of the market over the last 10 years And since joining our broader corporate family, he’s been helping everyday investors fatten their portfolios as they become far more knowledgeable traders. On that note, below are just a handful of the latest emails Jonathan has received from subscribers: - “Good morning. Joined in May… Even with small trades have now covered my [subscription] fee…didn’t think it would happen that quickly… Thanks Jonathan…excited going forward!”
- “Hi JR… I belong to all of your services and have made my subscription money back 4 times already. I enjoy watching you as often as I can.”
- “The trades I’ve made based on JR’s recommendations now total 24 winners and 17 losers with a net gain of [$XYZ]. All since mid-May. And I still know very little and have so much more to learn. THANKS, JR!!!”
- “We have purchased other services and lost $ but between [two trades] from JR we have already paid for all those services, his service and more. JR to the moon!
To get a sense for Jonathan and his trading style, you can start, totally free, by joining him in Masters in Trading Live. These are live streams every day that the market is open. They’re only about 15 minutes so they won’t eat up your day. You can click here to sign up. You can also join Jonathan in Advanced Notice, which is where subscribers locked in the returns that we highlighted a moment ago. From my own perspective, it’s one of the best ways to trade options that I’ve seen in my 25 years in the market. You can learn more by clicking here. In any case, a huge “congratulations” to all the Masters in Trading Live and Advanced Notice subscribers out there. It appears you’re in great shape to outlast either a Trump or Harris presidency.
Have a good evening, Jeff Remsburg |
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