Trump poised to finish first year in office with near-unprecedented market rallyBaltimore Post-Examiner

Trump poised to finish first year in office with near-unprecedented market rally

WASHINGTON – President Donald Trump is poised to finish his first year in office with a near-unprecedented market rally and one of the strongest stock market records of any sitting U.S. president.

When Trump assumed office on Jan. 20, the Dow Jones Industrial Average (DJIA) closed at 19,827.25. The S&P 500 index closed at 2,271.31. The NASDAQ Composite Index closed at 5,555.33.

Eleven months later, on Dec. 29 – the day U.S. markets closed for the year – the Dow had surpassed 24,719. The S&P exceeded 2,673. The NASDAQ eclipsed 6,903.

The historic market rally coincides with months of debate leading up to the final passage of the Tax Cuts and Jobs Act, which was signed into law on Dec. 22.

The legislation proposes $1.5 trillion in tax cuts and represents the most comprehensive overhaul of the Internal Revenue tax code since the Graham-Rudman-Hollings Act of 1986.

The top corporate tax rate is reduced from 35 percent to 21 percent.

The top personal income tax rate is reduced from 39.6 percent to 37 percent.

The threshold for which individuals are required to pay estate taxes is increased from $5.5 million to $11 million.

The child tax credit is raised from $1,000 to $2,000.

Pass-through businesses/sole proprietorships are eligible to claim a 20 percent deduction.

Many economists attribute the market rally to the deregulation of many industries.

Since January, Trump via executive order, and Republican lawmakers via the Congressional Review Act (CRA), have rolled back many Obama-era environmental regulations that energy companies deemed detrimental to coal mining as well as oil and gas exploration.

Many of those companies claim they have been able hire more workers and expand operations as a result of the regulatory roll-back.

However, during the first 11 months of the Obama administration both the Dow and the S&P 500 experienced significantly higher percentage gains than that of the first 11 months of the Trump presidency.

Obama took office in January 2009 as the U.S. was in the midst of the Great Recession.

The stock market had crashed less than four months earlier.

The Federal Reserve in response began pumping money into the economy with successive rounds of quantitative easing, which many economists attribute to the market recovery witnessed during the final years of the Obama presidency.

Congress responded to the financial crisis with a series of regulatory reforms such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

Many economists believe the crisis was triggered by the sale of toxic mortgage-backed securities to individuals who could scarcely afford them. Many of those individuals lost their homes and life savings when the market crashed.

This article is republished with permission from Talk Media News 

About the author

Bryan Renbaum

Bryan is a reporter and political columnist with Baltimore Post-Examiner and has broken multiple stories involving athletic scandals. He has been interviewed by ABC's Good Morning America as well as Baltimore area radio stations. Bryan has both covered and worked in the Maryland General Assembly and is extremely knowledgeable of politics, voting patterns and American history. In addition to his regular duties, Bryan freelances for several publications and performs investigative research. He has a B.A. in Political Science. Contact the author.

Leave a Comment

Comment Policy