PRE MARKET ON BITCOIN AND TAX REFORM
From yesterday’s report:
“Longfin Corp (LFIN) just came public last week at $5. Nobody cared. And then the company announced: it would be buying Ziddu.com, which is a blockchain-empowered solutions provider that offers a variety of sources, including Microfinance Lending against Collateralized Warehouse Receipts in the shape of Ziddu coins. The stock was up $16.62 on friday to $22.01. Yes…Ziddu coins!”
YESTERDAY…the stock ran to almost $150…that’s not a typo…$150…the company does not even have financials. They halted trading 8 times with the stock closing at $72…so a dummy who bought the highs was down 50%. After the close, the CEO appeared on that other business channel. The man could hardly explain what they do. And then he goes on to say he brought the stock public at $5 because that’s what he thought it was worth. As I write this, the stock is down $20 to $52 pre-market. BTW…the stock was brought public under new rules that fast track almost anything.
PEOPLE ARE NUTS. Some of this is worse than 99. I hope this does not mark the frothy, speculative top. Imagine someone paid almost $150 for something that was $5 2 days before. Why? Because it was moving. We repeat…when all this music stops and all these geniuses are found out to be passing through time, DO NOT BE THE LAST ONE IN.
TAX REFORM
Corporations win. Simple as that. Any corporation that pays high taxes…wins. Corporations that have paid effective rates at the lower levels, not so much. But it is a good change. You cannot have Ireland around 13% and the U.S. be at 35%. BTW…Chuck Schumer called for a gigantic corporate tax cut just last year…before Trump was elected. President Obama was also for a corporate tax cut.
Individuals, depending who you are, win and lose. Do not believe the Republicans who say everyone gets a cut. Do not believe the Democrats that this is a gift to the rich while the middle class are screwed. The % of people NOT paying taxes is estimated to go from 44% to 47%. The amount of earnings not taxed goes up markedly. The big losers are the wealthy who pay big real estate and state taxes IN HIGH TAX STATES…though taking the highest rate down from 39.6 to 37% helps out.
Pay no attention to the Democrats that are whining that it adds $1-1.5 trillion to the debt. They didn’t whine when Obama added $9 trillion to the debt on government spending. They are not whining about the $9-10 trillion of debt that is going to be added in the next 10 years because of government spending. But it is the end of the world if debt possibly goes up because of tax cuts…to the tune of a lot less than the spending. And do not get us started on the rest of the debt, deficits, waste, inefficiencies and all that crap coming out of DC.
The good news is that less of our money goes into their hands and more of our money stay in the economy’s hands. But to be clear, the amount is a fly on an elephant’s arse. The economy (the taxpayer) is going to send D.C. somewhere in the neighborhood of $45-50 trillion over the next 10 years so $1-1.5 trillion is a start but on a percentage basis, not the biggest of deals. Could we have done a better job? Absolutely! We would have made it bigger and a lot simpler. But simple is not a word that comes out of D.C.