Peak Gold vs. Dividend Valley

Dear Contra_Folk,

Taking this easily avoided (synthetic calls and put option strategies) quasi euro 15 day short-selling ban, along with more back-door money stuffing lobbyist meetings at the WH for the chosen Dow 30 (who are the only ones with the money available for this Administration to enact any fiscal policy), and in a major head and itchy shoulders top call, we have reversed our key portfolio positions, exiting/selling our (short) financials such as SKF-N, HFD-T and FAZ-N and have now gone long the opposite ETF’s .. long them into the close this weekend.

“Ain’t That a *itch, Somebody’s Doin’ Somethin’ Slick Around Here!  Yes, They Are…” J.Guitar

Thus, we believe the Plutocrats’ money will be repatriated by this Administration, and those holding previously off-shored (tax haven = zero U.S. tax) earned income will be allowed, if not begged, to bring it back at a lower rate than what Warren’s secretary pays in income taxes.  Question is, why are we allowing these effectively very costly tax changes to evolve, circumvented revenues that now will pay such low rates for “safe haven” re-entry / passage, or risk-free, low return rates of tax as compared to the normal U.S. taxation rates.  Why any tax difference would exist at all, you may ask…, is a good question.


Most developed Nations have jurisdictional tax residency statutes… so if you earn it here, or earn it there…  does not matter.   What matters is where is your Head Office and Management located, for that residency location is the “meeting of the minds” and then formally defines domiciled corporate residency and thus tax status.   A step towards creating big industrial money incentives, even now encouraging ever more, tax-free global consolidated non-gaap earnings and other Hold Co. (consolidated not for tax purposes) shell games.

Especially since, with today’s offshore money suddenly scared of suffering a loss of capital, and not the return on capital,… the Oligarch’s lobbyists are busy opening the tax-free foreign capital repatriation money flow express lanes which will pay less than a 15% tax rate…. likely 5%, no still too high, more like 2.5%.

Double Dare: 15% Repatriation Tax Rate on “Non-Taxed” Global Earnings

These tax-free wire transfers are now lobbying for “no duties paid” tax status for inflows of globally outsourced capital, and thus reminders of the many past “jobless recoveries” of yester-years, capital which will now finally get to fly safely come home to roost for good.  All safe and sound for little to no fees whatsoever.   However, the tax-exempted income will not be used to create too “many jobs” as “advertised” by the White House, for that may cause excessive inflation – which jeopardizes BZIRP (Banksters’ Zero Interest Rate Policy) which they need to keep alive through no-flation CPI/PCE reports.

So, no “serious” Hoover Dam-like 100% mandatory infrastructure build outs with this tax-free repatriated money, nor will it be used to provide verified hiring, or better yet Small Business funding for new businesses creating real net new jobs/payrolls in growth areas of industry, R&D, manufacturing, health care, energy alternatives, etc… but what it will no doubt provide however, is a one-time, special income boost for those luxury item Buyers, those top 20% of the consumer discretionary chain, spenders with gold level seats to all the exciting events in town, who are benefiting exclusively from ever more incentives to consume luxury items to create more “drip-down economics” from even more surging “overseas” yuan-recycled jobs.

What a gig… 5% or less tax rate.  

Those are persons who also, co-incidentally, just so happen to have always domestically owned 80% of the preferred shares outstanding float of foreign global affiliates, and therefore, now stand in a round about way.., to have been able to have earned this global “tax-reduced-to-near-free-rate” profit by simply waiting it out for a special “tax incentive” break from a Wall Street friendly Administration and Congress, who could together one day, successfully push through a democratically approved tax-exempt plan to get access to tax-free corporate profits.

So these folk now plan to earn, and benefit even further, from planning a majority of their income to be streamed through low-taxed dividend income.   Therefore, we are positioned into PGF-N and DLN-N to take advantage of big mergers, huge dividend payouts, and special capital dividends (tax-free) in the days ahead.

What glitters doesn’t pay any income,
Contra_Man

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About ContraManFund

Fictional (maybe not if you are an accredited investor) trading of a long/short contrarian-driven investment model portfolio based upon current economic environments and counter-intuitive trends. Legal Disclaimer The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions. NO MATERIAL HERE CONSTITUTES "INVESTMENT ADVICE" NOR IS IT A RECOMMENDATION TO BUY OR SELL ANY FINANCIAL INSTRUMENT, INCLUDING BUT NOT LIMITED TO STOCKS, OPTIONS, BONDS OR FUTURES. The author may have a position in any company or security mentioned herein. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility. Please consult your own investment advisor before making any investments anywhere, and always do your own due diligence before undertaking any individual investment.
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