David Haggith Blog | Tiny Trump Hands Deliver Teeny Tiny Tax Plan, US Stocks Collapse In Despair | Talkmarkets
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David Haggith lives in the Pacific Northwest and is the author of DOWNTIME: Why We Fail to Recover from Rinse and Repeat Recession Cycles and publisher of The Great Recession Blog for eight years, ... more

Tiny Trump Hands Deliver Teeny Tiny Tax Plan, US Stocks Collapse In Despair

Date: Thursday, April 27, 2017 11:40 AM EDT


The big announcement of the really, really big Trump Tax Plan with the “biggest tax cuts in history” came out bigly on Wednesday, as Trump promised. Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn, Trump’s latest tax team, beamed proudly as they presented their baby. The stock market took a deep breath, then looked at their brainchild and completely petered out.

First, let me say, I clearly have nothing to recant from my earlier predictions about Trump’s tax plan. The plan that came out looks almost exactly as I thought it would — the only difference being that it is far more pathetic.

Some news organizations, getting a little ahead of themselves, talked about the US stock market taking off because of the Trump tax plan when the market first got wind that the plan had been released and heard some of the key points:


Once again, investors appear to be placing the bet that Good Donald Trump will be great for the market and that Bad Trump won’t be all that horrible. That was on display on Tuesday. The Dow Jones Industrial Average soared more than 230 points after it was reported that the White House’s tax plan, whose broad outlines will be announced on Wednesday, will propose cutting corporate tax rates to 15 percent, a Trump campaign pledge that many thought the president was backing away from. (Newsmax)


Ah, but that was this afternoon, and now it is the evening after the market plunged as steeply as it soared (and twice as far) to finish the day with the Dow slightly down from its pre-tax open — a sign of a mercurial market that was, for an instant pleased, until it started to feel a little indigestion from consuming its dinner too quickly. At that point, it barfed up all its gains for the day and went to bed sour.

What the White House billed in its release as “the biggest tax cut in history” rapidly turned into digestive gas. As I speculated earlier in the day, no real plan was released. Just gas. Once again the Trumpet blew his horn loudly (probably from his back side) as he released the big plan, and then his team turned out a summary statement, devoid of any details or calculations.


Here is my own summary of the Greatly Trumped-up Tax Plan:


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