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Investment Perspectives

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Investment Perspectives is a monthly publication which provides our market outlook as well as insight into the state of the economy.

IP-Header.JPGThis month’s issue features the following topics:

“A Dustup in the Middle Kingdom" by Mark Luschini

The dustup swirling in the Kingdom of Saudi Arabia (KSA)—recently manifesting in headlines ranging from lifting the ban on women driving cars to the consolidation of military and political power by Crown Prince Mohammed bin Salman (often referred to as “MBS”)—is seen as a prelude to implementing the KSA’s plan for the future, known as “Vision 2030.” Indeed, we expect it to feature an ongoing battle against wasta, or reciprocity, a long standing way of conducting business in the KSA, among other things. If MBS and his cohorts sitting at the top of the Palace are successful, this could transform what has stood as a desert kingdom into a modern, diverse, and powerful nation-state.

“Tax Reform & Fixed Income Markets” by Guy LeBas

At the time of authorship, the merits (and of course demerits) of the 2017 tax reform package are still under debate, and it’s still not entirely clear whether the bill can or will be passed in its current form. That said, there’s been considerable progress from a nine-page outline released in September to legislative language voted on by the House in November and Senate in December. Now, as School House Rock famously taught, the competing bills will go into conference before ending up on the President’s desk. There are a handful of pieces in one or the other version of the bill as currently stands that have the potential to impact the bond markets, both from a macro and a micro standpoint.

“Will a Claus Be the Cause?" by Greg Drahuschak

Although last month was far from being the best November for the equity market, progress on a tax bill and comments from the incoming Federal Reserve chairman produced a late-month surge that allowed the S&P 500 to post its sixth straight November gain and its eighth straight monthly gain this year. The S&P 500 and Dow Jones Industrial Average ended on track for their best quarterly results this year.

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