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I’m rather frustrated about the lack of real results from the Republicans in Washington.
They haven’t repealed some or all of Obamacare despite seven years of promises.
Taxes - Tax - Code
They haven’t lowered taxes or reformed the tax code.
They did a business-as-usual budget deal earlier this year.
Trump - GOPers - Credit - Stock - Market
Yet Trump and some GOPers want to take credit for a rising stock market, as if that is some sort of positive reaction to their non-accomplishments.
As you can see from this interview, I don’t completely reject this hypothesis. After all, stock values are a reflection of the market’s expectations of future after-tax profits. So if investors think that good reforms – such as a lower corporate tax rate – are going to happen, then it makes sense that the value of financial assets will increase.
Way - Claim - Economic - Policy - Institute
By the way, I can’t resist commenting on the claim from the Economic Policy Institute that the stock market is a “meaningless indicator” that has nothing to do with the well-being of workers.
That’s nonsense. Assuming we’re looking at genuine and durable increases in stock values (rather than a bubble), that’s a reflection of a growing economy, which translates into more income for workers.
Language - Economists - Capital - Labor - Goods
In the language of economists, capital and labor are complimentary goods. More of one increases the value of the other. Which is why I told the folks at Politifact that it’s good for workers in the long run when financial assets become more valuable since that presumably means more investment.
“Dan Mitchell, a scholar at the libertarian Cato Institute, agreed that ‘capital and labor compete for shares of income in the short run.’ Over the long term, however, ‘there is no trade-off between corporate profits and labor income,’ he said.”
Issue - Trump - Credit - Stock - Market
But let’s focus on the bigger issue of whether Trump deserves any credit for the stock market’s performance.
Ira Stoll, writing for the New York Sun,...
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