NAFTA

We received a client email last week that raised the question: What are the current threats to the markets besides politics? Our response to this question was NAFTA. Right now it seems as though NAFTA talks aren’t going anywhere. This is important because NAFTA adds about 80 billion dollars to the US economy as well as over .5% to GDP. The longer these talks drag out, the more it could affect the US economy, especially manufacturing.

Congress

If Congress cuts corporate tax rates to 20%, that would result in earnings of the S&P 500 companies some $10 per share higher to $151 instead of $141 in 2018. In essence, the tax cut will add a lot to the bottom line, especially in financials.

Trading Partners

DC is focused mostly on the positives of this tax cut. It could be that they haven’t focused enough on things like NAFTA and the risks associated. Our trading partners have not forgotten about this. For example, Canada’s prime minister is traveling to China this week to discuss a free trading agreement. If Canada has a free trading agreement with China, our largest trading partner, it could weaken our case with them. So while we are focused on tax cuts, the other countries are working hard to fight us behind the scenes.

International Investor

Through the end of September the international investor has put 66.4 billion dollars into the US. This is the highest level in the last 5 years. This is one of those underneath factors we have been discussing that could potentially keep this market rally going.

Greg Powell, CIMA®
President and CEO
Wealth Consultant
Email Greg Powell here

Bobby Norman, CFP®, AIF®
Senior Vice President
Wealth Consultant
Email Bobby Norman here

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant
Email Ashley Page here

Trey Booth, CFA®, AIF®
Senior Vice President
Wealth Consultant
Email Trey Booth here

Fi Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. Fi Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Economic forecasts set forth in this presentation may not develop as predicted.

No strategy can ensure success or protect against a loss.
Stock investing involves risk including potential loss of principal.

Securities and advisory services offered through LPL Financial, Member FINRA/SIPC and a registered investment advisor.

#254 Jobs, Rates and Markets #252 Confidence Becomes Action