04232021 :: Friday finance

Friday was day 94 of the Biden-Harris administration. There is a proposal to raise capital gains taxes a significant amount to the highest the rate has been post WWII, but only for a very small percent of wealthier individuals. Raising the top marginal income tax rate is being floated, as well. Traditional financial markets didn’t take long to shake it off, though. Crypto has been another story, which may say something about who owns a good chunk of it.

Source: Fidelity
  • Yields have fallen and stayed down.
  • The DXY took a dive for the week.
  • Crude finished slightly down.
CALL: No change; near to semi-intermediate term, prices could rise further given supply shocks, OPEC+ micromanagement, inflation expectations, "recovery," and more fiscal spending, among other things. Longer term, it's a dying industry.[tracking: XLE, DRIP]
[tracking: TAN]
CALL: No change; expecting ever-lower valuations moving forward. Looking for an eventual floor around $1,200/oz.[tracking: JDST, GDX, GLD, SLV]
  • Total crypto market cap is sub $1.8 trillion as of publication.
CALL: No change; housing weakness inbound. For the call to reverse, labor conditions would have to consistently improve, among other things. A giant infrastructure bill could help, but the GOP is again looking to reduce the size and scope of yet another proposal.[tracking: DRV, XLRE, SPG, VNO, WPG, NLY]
  • Ethiopia entered into a $907 million financing agreement with the World Bank.
[tracking: MCHI, EDC/EDZ, VWO, EWU, IEV]

Footnotes

¹ “History lessons from past tax hikes.” Fidelity Viewpoints (September 30, 2020).

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