January 11, 2017

Wednesday’s markets saw the S&P 500 up 0.3% and Toronto up 0.4%.

Bombardier had another strong day, up 4.9% to $2.59. Welcome news for long-suffering share owners.

And AutoCanada was up another 2.5%.

The market reaction to Trump’s news conference was at first negative (the day’s early gains were erased) but by the end of the day was moderately positive.

At the risk of offending Trump supporters I thought he displayed today how much of a thin-skinned bully he is in attacking CNN for what he deems “fake-news”. He did score points on his economic plans however. I am not sure that the market fully appreciates that he is prepared to go ahead with his plans like building that Wall and reducing free trade. If he can get the approvals he needs, he will move ahead with these things.

In a different context, not involving Trump, Warren Buffett warned “never underestimate the man who overestimates himself”.  It seems pretty clear that Trump vastly overestimates himself and what he can accomplish as President. This could be dangerous.

Statistics Canada released a report about government finances showing revenue and expense items and more. By using the “add/remove data” function, I was able to see the revenue sources. I was shocked to see that taxes on goods and services are fully half as large as the total of all taxes on income, profits and capital gains.  But that was for all governments. I am not sure what all those taxes on goods and services are but it would include GST, provincial sales taxes and gasoline taxes and probably more. (Possibly it includes royalties on oil and gas production as I don’t see a line item for that). At the federal level the taxes on goods and services are only a bit over 25% of the total taxes on income, profits and taxable gains.

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