Core Insights - Economists identify tax cuts in Trump's One Big Beautiful Bill as a major factor driving the U.S. economy in 2026 for both individuals and businesses [1] Group 1 - The tax cuts are expected to significantly impact economic growth [1] - Both individual and corporate tax reductions are highlighted as key components of the economic strategy [1]

Market Outlook - The current year is viewed as a "unicorn year" for investors, with consumers expected to regain control over spending due to upcoming tax cuts [2][3] - The S&P 500 target is set at 7,600, indicating an anticipated increase of 11% from current levels, driven by consumer spending [3][10] Consumer Confidence and Spending - Consumer confidence has been low but is expected to improve with the introduction of tax cuts, which will provide additional disposable income [5][9] - Sectors such as discretionary and staples have underperformed, but the anticipated tax cuts could revitalize these stocks [6] Economic Indicators - Home prices have increased by 50% since 2018, contributing to an affordability crisis, which remains a significant concern for consumers [7] - The impact of Federal Reserve interest rate cuts is beginning to be felt in the economy, potentially aiding in the stabilization of home prices [8] Inflation and Wage Growth - Inflation is expected to decrease as wage growth has started to decline, which could provide relief to consumers [9] - Mortgage rates remain uncertain, but there are positive signs for the economy that could support a bullish outlook [10] Market Dynamics - The current market rally has been driven by valuation expansion, but future growth is expected to rely more on earnings growth rather than further valuation increases [11][12] - The focus for 2026 will shift to earnings growth as the primary driver of market performance, with a slight contraction in valuations anticipated this year [12][13]

Economic Performance - President Trump highlighted a significant reduction in inflation, stating it was the worst in 48 years when he took office, and now it is projected to be at 3.1% [1][4] - The federal deficit has decreased by 19% in the first two months of the fiscal year [1] - Gas prices have dropped by 3% compared to the previous year, and the grocery price index has decreased by about 5% since Trump took office [2] Tax Cuts and Refunds - The largest tax cuts in American history are expected to save families between $11,000 and $20,000 annually, with projections for the largest tax refund season ever [1] - A special "warrior dividend" of $1,776 is being sent to 1,450,000 military service members as a holiday gift [1] Wage Growth and Affordability - Real wage growth is being emphasized, with wages reportedly increasing faster than inflation, leading to better affordability for Americans [5][6] - The messaging around affordability has been improved, focusing on the contrast between real wage growth under Trump and wage losses under Biden [5]

Economic Overview - Consumers are still spending despite an early chill for the holiday season, with core retail sales up 0.9%, indicating stronger performance than the headline figure suggests [1] - The labor market has shown stagnation in payroll since April, with the unemployment rate affected by government shutdowns leading to temporary layoffs [2] Holiday Season Insights - The holiday season is compressed into December, which previously resulted in strong job gains, suggesting a potential repeat this year [3] Future Economic Indicators - Anticipated rate cuts by the Fed and expansions to tax cuts retroactive to 2025 may lead to double-digit gains in tax refunds, which consumers often treat as windfall gains, potentially affecting inflation data [4] Inflation and Labor Market Dynamics - The labor market is currently driven by healthcare and social assistance sectors, with concerns about the stickiness of inflation persisting even with potential improvements in employment [6][7] - There is a normalization of inflation occurring over five years, with sequential tariff-related increases contributing to this trend [8] Fed's Position and Market Sentiment - The Fed faces a divide between those advocating for lower rates and those concerned about inflation, with the current economic data suggesting that price stability has not been achieved [5][9]

Core Viewpoint - Jeremy Siegel criticizes President Trump's trade policies, particularly the tariff exemptions, arguing they contradict free-market principles [1][2]. Trade Policy Critique - Siegel believes that requiring businesses to seek tariff exemptions from the White House creates a system of favoritism rather than promoting an open market [2]. - He describes Trump's tariffs as a "discriminatory" and "very imperfect" version of a consumption tax system, which he supports in principle [2]. Economic Impact Assessment - Siegel assesses the overall impact of tariffs as "net a negative" for both the U.S. economy and the stock market [3]. - Despite this, he remains optimistic about the financial landscape, noting that other aspects of Trump's agenda are mitigating the negative effects of protectionist trade policies [3]. Positive Aspects of Trump's Agenda - Key positive elements include deregulation, the extension of tax cuts, and a less aggressive anti-merger stance compared to the previous administration [4]. - Siegel argues that these factors more than offset the negative impacts of tariffs [4]. Tariffs as a Negotiation Tool - Siegel has noted a decrease in his concerns about a trade war, citing the administration's willingness to negotiate lower tariff rates as a sign that tariffs are used as leverage rather than permanent barriers [5]. - However, he still views the reliance on presidential exemptions as a flaw in the economic structure [5]. Market Performance - On a related note, the futures of major indices like the S&P 500, Nasdaq 100, and Dow Jones were trading higher, indicating positive market sentiment following a strong close [6].

Treasury chief Scott Bessent has repeatedly brought up how he expects Americans to ring in the new year in part by reducing the amount of federal income tax that they hand over in every paycheck, making the move due to the tax cuts in the GOP's One Big Beautiful Bill Act. ...

Core Insights - Michigan's state budget for fiscal year 2026 was passed with bipartisan support, featuring significant tax cuts that align with President Trump's previous proposals [2] - The tax cuts will eliminate the 4.25% income tax on overtime, tips, and Social Security benefits for the next three years, which Governor Whitmer described as a "game changer" for residents struggling financially [2] Tax Benefits Overview - Over 800,000 Michigan residents are expected to benefit from the tax cuts, including many seniors who will see a reduction in their tax burden [3] - The Michigan Earned Income Tax Credit for Working Families will expand, benefiting approximately 650,000 families, particularly those in middle- and lower-income brackets [3] Specific Savings Breakdown - An estimated 500,000 workers in sectors such as construction, manufacturing, healthcare, public safety, and food service will save an average of $500 in taxes due to the elimination of the income tax on overtime [4] - Around 300,000 individuals, including servers and delivery drivers, will save an average of $400, with the elimination of taxes on tips being crucial for their financial stability [4] - Approximately 40,000 seniors will save an average of $500 annually from the removal of state taxes on Social Security benefits [4]

Core Insights - Millions of Americans will see tax savings for the 2025 tax season due to the provisions of the Big Beautiful Bill Act (OBBBA), which made many aspects of the 2017 Tax Cuts and Jobs Act (TCJA) permanent and introduced new tax deductions and credits for households [1] Tax Savings by Income Group - Working-class families earning between $15,000 and $30,000 will experience a 21% tax cut, the largest reduction among all income groups [2] State-Specific Tax Savings - Taxpayers in different states will experience varying levels of tax savings, with some states projected to save significantly more than others [3] California - California taxpayers are expected to save an average of $2,293.15 annually, primarily due to estate and gift tax breaks, averaging $898 per return, potentially saving over $3.2 million per estate [4] - The State and Local Tax (SALT) deduction is significant, with about 15% of Californians itemizing their returns, leading to average savings exceeding $5,200. Seniors benefit from an average savings of $1,386 with a new $6,000 senior deduction, and over 6.6 million qualifying children are eligible for the Child Tax Credit (CTC) [5] Oregon - Oregon taxpayers are projected to save an average of $2,226.61 annually, with estate and gift tax benefits averaging about $963 per return, allowing estates to save upwards of $2.5 million [6] - Approximately 13% of Oregonians itemize their returns, resulting in average tax savings exceeding $5,500. Seniors, making up about 20% of the population, could save over $1,100 on average with the new senior deduction, and there are over 670,000 qualifying children eligible for the CTC [7] Massachusetts - Massachusetts ranks third, with taxpayers saving an average of $2,150.45 annually, driven largely by estate and gift tax savings, which average about $921 per return, with individual estates saving more than $2.3 million [8]

Core Viewpoint - The article discusses the need for a supply-side economist to lead the Federal Reserve, emphasizing that tax incentives can drive growth while keeping inflation low [1][2][4]. Group 1: Supply-Side Economics - Supply-side economists believe that tax incentives can generate faster economic growth with lower inflation, contrasting with the Fed's traditional demand-side approach [2]. - The article argues that the Fed has historically misunderstood the relationship between growth and inflation, leading to detrimental policies [2][4]. Group 2: Federal Reserve Leadership - There are five finalists mentioned for the top position at the Federal Reserve, including Rick Ryder, Mickey Bowman, Chris Waller, Kevin Hasset, and Kevin Walsh [3]. - President Trump is expected to make a decision on the new Fed chair after Thanksgiving, as Jerome Powell's term ends in May [4]. Group 3: Economic Predictions - The article posits that tax cuts combined with tight monetary policy could achieve economic growth rates of 4% to 5% with virtually zero inflation [5].

Group 1 - Businesses are currently generating strong profits, which is a key driver behind their rising valuations [1][3] - The outlook for future earnings is positive, with projected earnings for 2025 expected to reach nearly $300 per share, representing a 14% increase [3] - The steady 10-year treasury rate at around 4% serves as a reasonable discount rate for capitalizing corporate profits into future value [4] Group 2 - Profits are essential for a strong economy; businesses losing money would lead to layoffs, reduced income, and decreased consumer spending [5] - The booming stock market is boosting confidence in profitable businesses, predicting a strong economy for the upcoming years, with GDP growth estimates around 4% for the second and third quarters [6] - Tax cuts for businesses, as implemented by the current administration, are expected to enhance profits, benefiting both stocks and the overall economy [7]