Trump's latest version of his proposed "tax overhaul" has companies betting they could use their spare cash to purchase more stock, improving dividends, even if that doesn't mean creating jobs. Stock buybacks are a lot easier on investors because they're relatively low-risk compared to brand new projects. Instead, money is made on the price of the share, which is the key measure of profitability. In this case, you don't even need to improve underlying profit, creating the perfect situation for analysts like Howard Silverblatt, who said "the additional cash will definitely help buybacks." These buybacks took the main stage during our tax holiday in 2004, which actually made it difficult for companies to provide their required economic benefits. So amidst the white house chaos we find one party who seemingly stands to grow from Trump's ramshackle tax protocol. Stock buybacks have caused the repurchase of nearly $3.8 trillion in stock since the end of March 2010, making them the cornerstone of modern broking. Hopefully we'll be able to find more areas of benefit from the same source. So far, Trump's tax plan only seems capable of helping the extremely wealthy.
Original Story: http://money.cnn.com/2017/12/03/investing/stocks-week-ahead-tax-plan-wall-street/index.html
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