☀️ Kamarades – August 12 2020

credit: bloomberg

President Trump said that he is “seriously considering” a cut to capital gains taxes. These are the taxes that investors pay when they sell an investment.

Investors often go out of their way to avoid capital gains because they can cut into the profit of the investment. Lowering the taxes would encourage investors to buy and sell assets, provoking movement in an economy that very much could use it.

Trump wanted this as part of his 2018 tax plan but put it off, citing that he did not think it would do much for the middle class. He is now considering doing this as part of an executive order. The move would be called “indexing capital gains to inflation.” It would adjust the purchase price of the asset when it is sold so there is no tax paid on the appreciation.

If you are a real estate investor, you love this move but guess who does not love this move? Joe Biden. The Vice President and Presidential candidate’s campaign trail tax plan proposes to increase capital gains. Watch this closely if you are an investor with assets to sell! If Trump does this, however briefly, and then Biden undoes it, you will have missed your window for favorable sales!

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The Other B Word

credit: montel

The number of US companies filing for bankruptcy is at a 10-year high. According to S&P Global Market Intelligence, 424 companies filed for bankruptcy as of August 9.

Many of these we have already known about because their filings make headlines. Brooks Brothers, Lord & Taylor, Men’s Wearhouse. The recent rush on filings includes both public and private companies with public debt. It does not include local smaller private businesses but surely that number is tragically high too.

News By The Numbers

credit: bbc showing the last moments of B-rex’s life

115 million. That’s how many years ago the newly discovered member of T-Rex’s family roamed the Earth. Scientists just discovered bones from what they’re calling Vectaerovenator inopinatus. I would have come up with something shorter like B-Rex.

50%. That’s the proportion of daily COVID-19 cases in the Americas that are from the United States, amounting to 50,000 cases each day.

102.  After 102 days without any new domestic cases, New Zealand suddenly registered four new COVID-19 patients yesterday. The government is still figuring out the source and has reinstated lockdown measures in Auckland.

British Pound Pounded

credit: unsplash

Sure the US economy is suffering but hey, we’re in good company! The UK has suffered more than any other European country, sparking worries about how Brexit will play out on the already shaky ground.

Output in the UK plunged 20.4% and pushed the nation into the first recession since 2009. There are some signs of recovery with good output numbers in June but spending and employment markers are still bleak for this time of year.

Analysts are not only worried about the effects of Brexit but also about a possible second wave of COVID coming in the fall. They blame the hard hit on the UK on the country’s late response to global shutdowns. The central bank is issuing warnings of economic “scarring.” Is there a salve for that?

Vrooom, Vrooom, Beeeeeppppp, Beeeeepppp

credit: usps

The US Postal Service is hurting for cash and has never had so many people rooting for its survival due to the upcoming election and demand for mail-in ballots. Well, if you’d like to help out, you can order a mail delivery Jeep toy!

USPS launched a collectible toy car line for sale this week. You can get a vintage 1971 model for $5.99. Proceeds will benefit the service, which is federally obligated to deliver mail but receives no government funding to do so.

This may seem like a silly business endeavor but have you ever met a child who does not want to play with a toy fire truck? Police car? Airplane? Mail truck? Children love toy vehicles and if they’re going to buy them, they might as well buy them from USPS rather than Hasbro.

The Friendly Pepper Upper Shortage

credit: giphy

We’ve written a lot of produce and meat shortages but guess what else is in shortage these days? Dr. Pepper.

We are talking about the soda of course. Not a COVID doctor with a vegetable last name.

The company posted on Twitter that their soda is unavailable in some parts of the country. Sales have been increasing steadily for years but the pandemic apparently has people buying in bulk.

Aluminum cans have also been in short supply, making distribution tough for beer and soda makers alike. Some beer makers that would have sent their product out in kegs to bars in normal years have had to pack it up for shelves, increasing the demand for the can. Americans have also developed an increased taste for canned seltzer, putting further strain on demand. Dr. Pepper did not specifically say that this was part of their problem but you’ve gotta think it’s related.

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