Deregulation, improving sentiment, and now, tax reform are reviving the US Economy, which is on track to exceed 3% growth in 2018.

Deregulation, improving sentiment, and now, tax reform are reviving the US Economy, which is on track to exceed 3% growth in 2018.

Joseph Sternberg, US Tax Reform Has Europe Worried, WSJ 12/22/17

The key words in the above quote are improving social mood. Internally generated changes in social mood drive societal change. And we are seeing that in many sectors. Let’s take a look.


Energy shares are outpacing the price of oil itself. This reflects positive mood that prices will at least stay this high if not increase. That means profits for oil producers. The Energy ETF XLE rose 4.42% over the past week. Exxon, Chevron, and Schlumberger comprise some 50% of the XLE and are doing well.

The Energy Service ETF XES is finally coming alive. It rose above its 200 day Moving Average. Numerous different moving averages appear to be converging. This typically precedes a change in direction. Copper prices are strong and that chart is improving. Breaking through resistance at $3.20 will be another bullish indicator for the commodity sector.

While the media reports on pipeline breaks and OPEC attempts at holding back production, that is not what is driving the improvement in the energy market. Improving sentiment towards the US and world economy is increasing investments in the energy sector. The markets are expecting a greater demand for energy. Which brings us to, yes, tax reform.

Tax Reform

The Democrats thought tax reform like ACA repeal would fail. It did not. So the strategy was to simply denounce it as the usual gift to the rich. Not a single Democrat joined the tax reform debate. Ironically Senate Democrat Chuck Schumer was working with Ohio Republican Rob Portman on tax reform in 2015. But President Obama nixed that idea.

The media is obsessing whether the Republicans can "sell the success of tax reform" to Americans. That is the spin for a media biased against everything Trump. I suspect the American consumer will make that decision. It will take until February or March for withholding taxes to decrease on paychecks. Then Americans will decide if, as Nancy Pelosi puts it, this is “the worst bill in US history.” The two parties are in full blown negative mood, each excluding the other from a real debate.

Apparently corporate America does not see it that way. ATT, Comcast, Wells Fargo, and Fifth Third Bancorp have all announced hefty widespread bonuses for employees. This is real income redistribution in that the income is distributed to working individuals rather than the government. Perhaps we will see some real policy debate in coming months rather than cheap personal shots and the usual charges of favoring the rich.

Bentley RIP

Adopting a rescue dog won’t change the world. But it sure changes the world the dog occupies!

About nine years ago a haggard Catahoula was spotted in a field near our house. Starving and losing its hair coat every day, he warily approached our house looking for food. His neck bore the signs of a cruel chain. He was clearly afraid of males suggesting an abuse pattern which surely triggered his escape.

At 64 pounds, 20 shy of what he should have weighed, he would surely not have lasted another week. And so we ‘adopted’ him. A fist full of hypodermics at the vets and a regular diet improved both the weight and the coat. He remained fearful of myself, being male, refusing to go for a walk with me and running back home. It took a long time to gain his trust but it did happen. Eventually he came to demand a daily one mile sniff and walk with me.

We named him Bentley in the tradition of the British automobile. He was a beautiful brindle of gray and black, shining in the sun after a bath. A member of the hound family, he let his presence be known each morning, yep, just crying all the time as the lyrics go.

He enjoyed good health until last week when he began suffering seizures. And then a final seizure occurred taking him away from us.

There are many worthwhile charities. But our canine friends are often without a friend. If you have the money and capacity, consider adopting a rescue dog or cat from your local shelter during the Holidays. It is the one life changing gift you are empowered to make. And believe me, the rescue will thank you every day, which is the best dividend a person can receive.