2017 1st Quarter Commentary


We realize that many people supported the Trump presidential campaign, and many did not. However, since Mr. Trump was elected President of the United States, his agenda matters in terms of the economy. As we listed in our last quarterly commentary, there are three things the Trump presidency has announced it intends to do that could have an impact on the U.S. economy and, therefore, have an effect on the U.S. stock markets.

As we listed them in our previous commentary, they are:

  1. Roll back excessive regulations in many industries.
  2. Lower corporate income taxes.
  3. Repeal & replace the Affordable Care Act (Obamacare.)

After the House of Representatives failed to agree on how to accomplish #3 – repealing and replacing Obamacare, it was then put on hold for a while. However, the easiest one to accomplish is #1 – the rollback of excessive regulations. Most of these regulations were done through executive orders and can be undone with executive orders.

Rolling back regulations is the one of the three that may have the greatest impact on U.S. business growth. The combination of the rollback of regulations and corporate tax reductions could go a long way toward releasing the pent-up growth which has been held back since the financial collapse of 2008. However, the efforts of those opposed to the rollback of the regulatory rules is very strong. Many of President Trump’s executive orders are being immediately challenged in court. As the Republican’s attempt at healthcare legislation taught us, the timing for accomplishing these agendas can be uncertain.

As we talk about the stock market and economic reaction to the Trump agenda, it is important to remember that at Financial Professionals Inc. we believe in using diversified portfolios. Historically, diversification has been a great tool for investors to weather both economic and political storms. U.S. stocks are important, but we also have bonds and international stocks in our portfolios. Hopefully we can strike a good balance and move ahead with a stronger economy.


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Financial Professionals Inc.