By coinnews 
00:00 Speaker A
One of the things that has been a little bit mixed when I talk to investors is how they view these tax cuts, whether they view them as a huge positive catalyst for the market or just a deletion of headwinds. Where do you see it? Like are these tax cuts just an extension or are they bigger tax cuts than what we saw in 2017? How does it net out for investors?
00:25 Speaker B
Yeah, for me, I think that this is just an extension of status quo. Maybe you get a little bit of lift on the margin. Um but if you’re even looking at the corporate tax framework, we’re not getting that decrease in top line corporate income tax that was promised on the campaign trail. That isn’t on the table. That I would think would maybe give the biggest oomph on a, you know, a short-term tailwind basis. But the rest of this is just an extension of status quo. And maybe what you’re getting is more of a relief for the consumer in relationship to that tariff call. So for us, this could, you know, I would say a nice to have, but it isn’t going to be the big sort of relief package that we’re expecting for markets.
01:20 Speaker A
Can you operationalize that relief for me for consumers? Like how big is that relief going to be?
01:29 Speaker B
Um as for how big it is, I don’t have those numbers because if you’re thinking about what, right, it’s changing every second. And if we’re looking at especially say a salt relief piece, maybe that from a, if we’re thinking about consumer strength, you’re getting more movement in the housing market, right? You could have, you know, people leveraging up from in mortgages. That is a wealth builder. So when we’re thinking about a from the economics perspective, a sort of balancing around potential, you know, tariff risk, that could be something that could at least be in the positive checkbox. Um so we’re going to see how that, how that goes. But other areas where you could see a little bit of giveback is at bonus for seniors and that’s always a benefit. But the problem there, if we’re thinking about the consumer side, is that typically those types of things for seniors go into savings, right? Until they’re ready to have that drawdown. So it is a little bit of a delay. It’s not a direct economic multiplier or spending multiplier.
03:05 Speaker C
So your comment on, you know, the extension for corporate taxes not really having a lot of extra oomph, right? So when we look out at 2026, maybe even 2027 earnings expectations, you don’t really see a lot of incremental positive coming out of this deal, assuming we get one.
03:30 Speaker B
Not related to taxes at this time. You know, we’ll see we we are going to have negotiations well into the evening and and early morning hours of of Wednesday and we’ll have a more clear path forward from there as they head towards Memorial Day. But when we’re thinking about where the gains are for corporates, it really is a 2026, 2027 potential for fiscal spending and which companies are beneficiaries of the new budget cycle. So 2026, we already know there’s likely to be a 13% or more increased defense spending, for example. And I think AI, data centers, infrastructure, all the second derivative beneficiaries are going to be a part of that call. And so for us, it’s not really about the tax bill that’s going to get us there. It’s going to about be about this sort of pro-growth spending piece of the equation.
05:03 Speaker C
On on that front though, you know, Trump has talked about kind of uh dialing back the chips act effort, right? That we saw under Biden. How do you see him fostering capacity coming into the US because we clearly need to have that.
05:28 Speaker B
So I I think what’s interesting about that um is that it it my feeling is that it could be a talking point. I I have strongly uh had that reinforced by comments from Greer and Lighthizer who have said that they’re actually interested in doing more subsidies, potential for more subsidies, not only for semis and chips, but also shipbuilding and pharma. So they are looking at sort of a a I would say choosing at the buffet, right? of different policy options and not necessarily locking into traditional GOP or traditional Democratic playbook. And so this is going to be really interesting for how 2026 plays out.