#278 Trade, Oil and Patents


The Federal Reserve meetings, jobs reports and bulk of earnings season all seem to be behind us. The attention will now be on trade. Discussions of trade with China and trade talks with NAFTA have come to the forefront. The problem is it’s hard to do any sort of analysis on these topics because there could be an abundance of outcomes that could come out of this. The Mexican election is getting close which could prove to be very important with NAFTA.


Oil talks have taken a backseat lately because oil production in the U.S. has gone up which, in turn, has caused energy areas’ profits to rise. We have almost ignored the fact that gas prices have risen as well. Historically, higher gas prices have hurt the consumer. So far this year prices, on average, have gone from $2.35 to $2.81. This doesn’t sound like much but when you multiply it across U.S. consumers it relates to 60 billion dollars a year. This is a large number that would usually affect consumer spending. The tax bill is ready to provide 120 billion worth of benefits. The consumer will likely still spend money on higher gas prices because they get relief in taxes. Oil companies are making more money, which is good, but at what point does that start to hurt the consumer more than cutting taxes helps the consumer?


Something that could have a major economic impact that you might not hear anywhere else is patents and intellectual property. In summary, 900 billion dollars or 5% of the GDP is tied up in our patent process. Historically, the United States has been 1st in terms of that level of economic contribution within our borders, in which we have now dropped to 12th. The reason for this is in 2011 a lot of the Silicon Valley or tech giants really started to extract or take patents. There is a Supreme Court decision coming up in the next couple of weeks that would essentially make patents better protected. This could be a good thing for the economy and is definitely something to keep an eye on.

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.

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