17 November 2017: Hurdles

Donald Trump’s plan to cut taxes took the first hurdle: the House of Representatives agreed to his proposal. Financial markets reacted as if this plan was already implemented and delivering its full effects. But it is totally unclear if this plan will be accepted by the US Senate. The Republicans only have a slight majority in the other chamber of the US Congress and the dissidents within the Republican part of the Senate already outnumber the slight surplus they have in the Senate. It is more likely that an alternative plan that is in the making by a number of Republicans in the Senate will make it. This plan can be considered a downplayed version of Donald Trump’s tax plan. Expect markets to go down once it becomes clear that Donald Trump’s plan is not able to take another hurdle.

white-chapel-logo-smallUS stock markets closed dramatically higher Thursday, taking inspiration from the House passage of a Republican-sponsored tax cut plan. The Dow gained 0.80%, the S&P rose 0.82% and the NASDAQ closed no less than 1.30% higher, to finish at a record. Naturally, volatility eased strongly, with the VIX losing more than 10%. UVXY ETFs had to take a firm step back: -8%. XIV ETNs gained more than 4%.
Danny Daredevil is back where he ended Tuesday, at an RSS of 33%. Adventurous Anny is still holding cash. Her RSS remained 15%. Solid Suzy and Lazy Larry bounced back. Their RSS rose once again above 60%.
None of our models gave a trading signal at the end of yesterday’s session.

Model Holds Start date

RSS

YTD

QTD

AAR

Danny Daredevil UVXY 1 January 2016

33.22%

-66.95%

-4.38%

16%

Adventurous Anny Cash 6 March 2017

15.37%

15.37%

6.34%

23%

Solid Suzy XIV 6 March 2017

61.83%

61.83%

10.63%

99%

Lazy Larry
XIV 6 March 2017

61.83%

61.83%

10.63%

99%

RSS = Return Since Start | YTD = Year-To-Date | QTD = Quarter-To-Date | AAR = Average Annual Return

 


Meanwhile in Japan
René’s Reflections @ Friday: Non-exportability

Suppose I could bring something — anything — from Japan back to the Netherlands, and suppose I would choose this robatayaki (Japanese style grill bar) from Osaka, then would it feel the same, taste the same, once back in my home country? Most likely not. But what could be the missing element(s) that make this unique experience non-exportable? If I know the answer to that question, I would seriously consider starting a chain of robatayaki diners in Europe, knowing for sure that this would become a glowing success in less than no time!