executive impact

Nomura sees opportunities from Trump's pro-business agenda

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By Thomas Wilson and Emi Emoto

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Trump is pro-business? Well, he's pro-his-businesses. I haven't seen much policy otherwise to suggest he has any coherent ideological or policy direction.

6 ( +8 / -2 )

Cutting the US business tax rate (one of the highest in the developed world) most certainly is a coherent pro-business policy direction. Even Japan's tax rate is lower than he US now.

The pro-socialism and overarching regulatory policy of the past 8 years is one of the biggest reasons Trump was elected.

Of course Nomura likes this because, like bookies, they get paid the vig on trades either way as people reshuffle holdings.

-3 ( +4 / -7 )

qwertyjapanJAN. 02, 2017 - 11:10AM JST Cutting the US business tax rate (one of the highest in the developed world) most certainly is a coherent pro-business policy direction. Even Japan's tax rate is lower than he US now.

Erm... So? Tax rates aren't races to the bottom, they're set according to fine-tuned calculations of what is best for government sustainability compared with what is best for business prosperity. Japan's rate being lower isn't bad for the US or good for Japan until someone can do the calculations to show their outcomes are better.

In any case, tax rate is one single policy (which the President doesn't even get to decide), and by definition a single thing cannot be coherent with itself. So what other policies does Trump have that fit with this single tax proposal to be coherently pro-business?

The pro-socialism and overarching regulatory policy of the past 8 years is one of the biggest reasons Trump was elected.

Be honest: you can't even name a single pro-socialism US policy, can you?

4 ( +7 / -3 )

The Affordable Care Act

-3 ( +2 / -5 )

Pro-socialism US policy?

• Medicare • Medicaid • Welfare (for Walmart and other major companies) • Public roads • Public education • Social Security

But the US is no longer a socialist or a democracy. It is an oligarchy. In an oligarchy major companies own and run the government. The beneficiaries of an oligarchy are the owners of capital (stockholders). The losers in an oligarchy are the workers.

Those who voted for Trump will soon find themselves losing public education (Trump's Secy of Education Betsy DeVos is against public education as she makes money in private education), medicare, medicaid, food stamps, and other welfare. Walmart, of course, will still benefit from welfare.

Already the Republicans are currying favor with the President-elect by figuring out ways to gut social security.

3 ( +6 / -3 )

"Everything we know suggests that we're entering an era of epic corruption and contempt for the rule of law, with no restraint whatsoever."

The Chump is NOT pro business. He is pro Chump.

4 ( +6 / -2 )

Refresh my poor economic study: is it not true that the only recent President to balance the budget was the one with the "peace dividend" won by reducing the military (viz., Jimmy Carter)? Will Mr. Trump as President see the business savvy of this approach? It is militarily wise as well since Al-kaida and IS and the like cannot be beaten by nukes or "conventional" warfare including urban guerrilla warfare. They must be beaten by ideological reform. It has become real-politics to "overcome evil with good" (Romans 12:21), since the battlefield has become human hearts in general.

4 ( +4 / -0 )

what other policies does Trump have that fit with this single tax proposal to be coherently pro-business?

Cutting useless regulations is also pro-business.

Certainly Trump trade protectionism wouldn't gel well, but I think the chances of trade protectionism are less than the chances of tax and regulatory reforms. The Republicans have control of all branches, and while I believe that Republicans want to reform tax and regulatory policy in a pro-economic growth way, I'm doubtful that they will have the same degree of agreement regarding anti-trade policies.

At the end of the day, the reaction of the stock market in the wake of the election is unequivocal, and remarkably so considering that a Trump presidency was supposed to ruin the economy. (Perhaps it was the GOP also taking both the house and senate that was the saving grace.)

Things could change, but for now the market is up close to all-time highs. Can't argue about that.

-2 ( +0 / -2 )

Markets can be irrational. The surge in stocks since Trump getting elected seems counter intuitive, as who on earth knows what Trump is actually going to do. Uncertainty usually rattles markets but it doesn't seem to have here.

My view, a correction is in the offing.

2 ( +2 / -0 )

Trump's "pro-business" policy is really a "pro-make me and my billionaire friends trillionaire friends".

2 ( +2 / -0 )

Trump speculators on cloud nine with all his BS. The place to watch is congress as they have the purse strings. They make the budget and spread the cash or cut the cash. There will be a correction. but jump out 1/20/17 as there will be a correction. That is when reality will sink in and what really happens. Both sides are not big trump fans. Orange twitter will fail and do all the opposite he promised in his big Con campaign. Take your money and run into safety and watch the market as buy low sell high!

1 ( +2 / -1 )

DocCarlos,I agree with you.i do believe strongly there will be coming correction soon after Trump takes office.20k is no more than a trap,it has no meaning,forget about round number,all news and expectations are already over priced,what else?!on the ground nothing yet happened nor Trump took office.i don't believe he will put what he said during campaign into actions,strong dollar not in anyway good for US economy,it will damage export badly,but what I personally believe,dollar-in case of big inflation-will go to hell down,it's very likely scenario.gold will rocket high and oil will gain a lot.better to step out of market earliest possible,waiting and watching what will happen in the first month,not 100 days,much better than to be the last one to leave and have to turn off lights.

0 ( +0 / -0 )

What most people overlook is that the motive to regulate and tax is less for safety and collect revenue than it is a way for politicians to extort money and favors from industry. Taxes are raised, regulations are legislated, but always the loopholes and exceptions. These loopholes and exceptions reward those industries whom support the writers and sponsors of these rules and taxes, and punish those who don't.

The larger, and well-established companies are not much effected by these rules and taxes, but potential competitors are. If I want to create a new car company, or new airplane company, it is essentially impossible, because the myriad rules and regulations simply cannot be met. The handful of large manufacturers in America are virtual monopolies.

A century ago there were extremely few rules and regulations, in America there were thousands of companies which made machines like bicycles, and hundreds which produced motorcycles, cars, and trucks. The most successful of these companies used their wealth to lobby the government to create rules, regulations, and exemptions to protect them from competition. And in the end, in the most industrialized country in the world, there are only 3 major car manufacturers. There is only one major motorcycle manufacturer, and no major bicycle manufacturer.

In the end, since manufacturing and heavy industry is so massively regulated, insulated, and taxed, we end up with a service economy. The higher cost of locally manufactured products creates an influx of less expensive imported goods. Instead of an economy based on the manufacture and selling of goods, the emphasis is only on the selling end. The lack of domestic manufacturing not only means less manufacturing jobs, but fewer jobs in the vast infrastructure which supports such manufacturing.

Trump needn't enact a singe tariff on imports, he merely needs to smash the regulatory ceiling which prevents industry and manufacturing from growing and thriving.

Trump speculators on cloud nine with all his BS. The place to watch is congress as they have the purse strings. They make the budget and spread the cash or cut the cash.

Except that Trump nominally controls both houses of congress, and both will support him, whether they like him or not. And the democrat party shot themselves in the foot when the changed the filibuster rules. These being the case, Trump takes office with much more power than any of his predecessors. He has carte blanche to appoint anyone to any position in any department, save the supreme court, and there is nothing the opposition can do about it.

1 ( +1 / -0 )

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