Will Trump’s Tax Plan Really Benefit Everyone?

There has been a lot of mixed reaction to President Trump’s tax reform proposals and many supporters believe his plan will have cuts benefiting everybody including those in the lower income brackets. Opponents say that this tax plan is geared primarily to the wealthy and will be giving them even more loopholes. But what is the real story behind what Trump and his Republican colleagues in the House and Senate are trying to work on?

Business Insider did a breakdown on the proposed plan based on suggestions put forward by Trump and his aides, and this is what they say about it. First, the tax plan has a reduced tax bracket to four with those of 12%, 25%, 35%, and 39.6%. The plan has savings in some categories where the standard deduction comes in and how he would like to eliminate some penalties on the upper earnings, but the plan also seems to be eliminating benefits for itemizing deductions.

So how much will those in the regular middle class income category save? For those who file single and have no children, those who make $25,000 a year or less are estimated to save about $178 in taxes owed. Those who make $75,000 a year are estimated to save about $2,000, and those who make $175,000 a little over $4,000. Those who file jointly could see double savings with a $24,000 deduction. While simplifying the tax brackets and increasing the standard deduction could lead to some more savings, those who expect a huge savings gain out of this may be disappointed.

U.S. Economy Doing Well For 84 Months

Since 2010, the United states economy has been adding jobs. And doing so for consecutive 84 months. Unemployment seen nearly a decade ago has vanished. But, not every sector is benefiting from economic growth, MarketWatch reports. When it comes to retail, the jobs there have been disappearing at a rate of 6,600 per month.

Retailers are cutting staff, and even closing shops, due to intense competition coming from Internet-based retailers, especially Amazon. General merchandise, health, and electronics stores are among the ones that have suffered for a while from the hands of Amazon and the likes. Now, even grocery stores are shedding jobs.

Meanwhile, manufacturing and mining industries are recovering and creating jobs. This is due to a fall in the value of a dollar, thus making exports cheaper for foreigners. Also, commodity prices have stabilized, so miners, especially in the oil industry, are increasing production.

However, jobs in the traditional information industries are disappearing. Since 2001, due to the advancement of the internet, a million jobs in broadcasting, telecommunications, and traditional publishing have been lost.

The advancements in Artificial Intelligence are also likely to bring disruptions in employment. Automation is likely to destroy, as well as create, jobs in manufacturing and service industries. Now, even some paralegal and accounting jobs are threatened as more advanced system come to the marketplace. But, so far, the economy is doing well. Is that the quiet before the storm?

Deciphering the Economic Impact of Brexit

Citizens are still reeling from Britain’s decision to leave the EU. The Department for Exiting the European Union, formed in the wake of Brexit, will be responsible for creating a smooth transition for the major change. The department’s committee has been tasked with studying the potential effects of leaving the EU, including the economics and free trading arrangements between Britain and the European market.

The Department for Exiting the European Union is being headed by four ministers. David Davis is the Secretary of State, responsible for overseeing the withdrawal negotiations of the exit. Then there’s Lord Callanan, the Minister of State, in charge of business affairs. Steve Baker is the Parliamentary Under-Secretary of State; he will be focusing on policy and strategy in preparation for the exit. Robin Walker is another Parliamentary Under-Secretary of State; he will be focusing on the UK’s future relationship with the EU in matters of migration and security. There is also the Permanent Secretary, Philip Rycroft, who replaced Oliver Robbins in October 2017.

British citizens are worried about the deep and complex relationship that Britain has with the EU. Some industries are expected to be negatively impacted by the UK’s decision to withdraw, notably the automotive sector. Overall 58 sectors will be analyzed. The status reports will provide details on how each sector contributes to the EU and vice versa.

Vanilla May Be Going Away As Consumer Demand Declines

Apparently, plain vanilla flavoring is just not good enough for the public anymore. It used to be the flavor of choice for a lot of people, but the public has grown tired of it. In fact, the whole idea of “plain vanilla” has a very negative tone to it. It is as if to say that something is just too boring to be bothered with. If that is the case, then why would someone want to get vanilla flavoring in the first place?

The BBC reports that vanilla is not unique enough of a flavor for people anymore. Instead, many restaurants and other facilities are experimenting with other unique flavors to try to find something that catches on well with the public. The taste buds of that public can be a fickle thing though.

For far too long, the flavors produced by the big ice cream companies have been dominated by the simple chocolate, vanilla, and strawberry. There is not much creativity to that, and this may help to explain some of the decline in interest from the public in eating ice cream in general. It is time to mix things up and try some different (and even potentially unusual) flavors to get the public back into ice cream.

The Chinatown Ice Cream Factory in New York City has been doing exotic flavors in their ice cream for some time. For them, this change in global consumer demand has been a plus. More people than ever are interested in just what it is that they are mixing up in there. It just goes to show you the power of economic changes.

Good News About The Economy, But Will It Last

The latest news from U.S. News and World Report is a mixed bag for those looking for good news about the world economy. What they have said is that while world economic growth has reached levels not seen in approximately seven years, the level of growth going forward is not expected to keep up at that pace at all.

The Organization for Economic Co-Operation and Development (OECD) is the group that came out with this report. They stated in the report that the growth levels were indeed strong, but that things like wages remained stuck in the mud. The group put out a growth project of 3.7 percent for 2018 and 3.6 percent for 2019. These rates are higher than what we have seen in a lot of cases, but the group cautions that they are relatively modest compared to standards from decades past.

The OECD said that its forecasts carry with them some doubt as it is not yet clear what kind of tax policy (if any) will emerge from Congress and the White House. That tax policy could certainly stir things up at least domestically for a while in the United States.

Forecasts for most of Europe look pretty rosy in the eyes of the OECD. The main issue with economic growth in Europe is the United Kingdom. Since their vote to exit the European Union, the country has been floundering on the world economic stage. There is still so much to be hashed out between the United Kingdom and the rest of Europe in regards to how this exit will happen. It remains unclear to this point what the next step will be.

With Government Shutdown Looming The World Markets Tremble

It is always a shock to the political and economic systems of the world when the United States government effectively shuts down. This has happened a number of times in the past when Republicans and Democrats could not get together to hash out a spending deal that both sides could agree on. Now, it looks like this very well may happen again.

Top Congressional Democrats Nancy Pelosi and Chuck Schumer have cancelled a scheduled meeting with the President reports CNBC. This coming after the President tweeted that he could not envision any kind of deal being struck between himself and the Democrats to avert a government shutdown.

The Democratic leaders who had the meeting scheduled with the President pounced on his words saying that they would just as soon meet with Republicans in Congress to work on a deal with them since the President so obviously did not see a way forward himself. They cancelled the meeting and presumably will try to meet with other Republicans in Congress instead.

The Federal Government is slated to run out of funds on December 8th. If the two sides cannot come together and get something passed, then the government will begin to shut down. In the past, the two sides have come together to pass what is known as a continuing resolution (or CI) to essentially punt the decision away to a later date. That could be something that comes up in discussion quite frequently in the coming weeks as the two parties try to figure out some plan that will work.

Morgan Stanley Warns Investors About 2018

Morgan Stanley says that investors have to be careful about 2018. It is warning that 2018 will be a tricky year. The economy in the United States and in China is expected to decline. Inflation will rise around the world. Andrew Sheets of Morgan Stanley said that he expects the growth of the United States economy to slow down as the economy enters the inning of the economic cycle. In China, the economy is also expected to slow down because of uncertainty about economic policy.

So far this year, the economy in both the United States and in China has grown at a good rate. In the United States, the GDP grew by 3% in the last two quarters, and in China, the GDP grew by over 6%. Morgan Stanley is predicting that the growth rates in 2018 will be less than what they were in 2017.

The tricky part is the economy in India and Brazil. The economies in those countries are crucial for the overall global economy. However, the economy in India hit an all-time low. In addition, the economy in Brazil has been growing at an extremely low rate.

Inflation is also expected to rise. In the United States, core inflation is expected to rise by a few points. Core inflation does not include food and energy. In China, overall inflation is expected to rise as well.

Monetary policy around the world is also expected to get tighter. Governments and central banks are expected to slow down their programs and not make as many interest hikes. Morgan Stanley is advising investors to stay safe by selling United States corporate bonds and buying European ones instead. The European market is more reliable and less volatile.

The World Waits To Hear Who Will Lead The Federal Reserve

The Federal Reserve is an incredibly important position to have. The individual who is the Chairman of the Fed has enormous power to shape the economic picture in the country. The policies that they enact or refuse to enact can shape markets for many years, sometimes even after they have left the scene entirely. This is why the financial world is on pins and needles awaiting an announcement from President Trump on who will be the next Chairman of the Federal Reserve.

The current Chairman Janet Yellen is set to leave her post there is February says stltoday.com. She has had a mostly smooth leadership over the institution since she was appointed as Chairman by then President Obama. The economic in the United States and around the world has been pretty healthy during the entire period of time that she has resided over the Federal Reserve. It is not to say that everyone agrees with everything that she has done, but she can probably be pretty happy with her record there.

The world is curious to see who President Donald Trump will appoint for this position. The rumor is that Jerome Powell is the most likely candidate. He has been a member of the Federal Reserve Board for some time. It seems likely that it is his time to take over the reigns. That is unless there is some kind of surprise announcement. It is difficult to say from a White House that is prone to making surprise announcements and decisions.

China Wants To Be A Player In Eastern Europe

Eastern Europe has a few different superpowers that are interested in courting it for their own political reasons. In fact, it seems as if the countries of Eastern Europe have become a favorite political pawn between the East and the West of the world as it were. Most of that game has been played between Russia and the United States, but no one should ignore the influence of China in the region at this critical moment.

The investments that China has made in Eastern Europe are small in comparison to what South Korea and Japan put into the region, but China has placed its investments into very specifically political causes within Eastern Europe. They definitely have a strategy when it comes to where their money is going.

Two Chinese government-owned banks have entered into the markets in the Czech Republic, and the government has become a major shareholder in a Czech airline as well. Basically, China is taking steps to shore up its economic and political power in the region slowly but surely.

There have been a number of official state visits by high-ranking Chinese officials in recent years says the Financial Times. Still, a lot of this has gone without notice as so much of the attention to this issue has been focused on what Russia is doing in Eastern Europe. Both developments certainly deserve our full attention, and both will certainly have impacts for some time to come on the power structure in Eastern Europe and the rest of the world.

Finding a “Gold Lining” in Economic Inequality

A report that the billionaire class is increasing in size and wealth has added fuel to the issue of economic inequality. However, there may actually be a positive side to the issue when considering what the wealthy class does and can do for everyone else.
The number of billionaires in the world exceeded 1,500 in 2016, an increase of nearly 150 over the previous year. The combined global wealth of these family units is believed to be around $6 trillion. This situation could be considered a public relations nightmare for the billionaire class, but it could also be motivating them to take action. More information the effect of great wealth is available at www.theguardian.com/business/2017/oct/26/worlds-witnessing-a-new-guilded-age-as-billionaires-wealth-swells-to-6tn.
According to one study, some 98 percent of the wealth owned by billionaires makes its way back into the economy. The wealthy class employs some 28 million of the world’s citizens, which is good for those at even the lowest income levels. Additionally, the upper class has invested heavily in public institutions and facilities. In one example of this shared wealth, a Japanese billionaire is in the process of building a number of galleries in his country. It is the billionaire class that generally owns professional sports teams, which give enjoyment to millions on an almost daily basis.
Concern over economic inequality can ultimately lead to important policy changes, such as the increase in taxes on the wealthy and the dismantling of corporate monopolies enacted under President Theodore Roosevelt. Society in general can benefit from billionaires, provided that their wealth is shared and their income is properly taxed.