[Altos Weekly Traders Edge] Higher Tax Rates a Threat or No...Details Inside

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By clicking the link above you agree to periodic updates from ProsperityPub and its partners ([privacy policy]( Are Investors Missing the Real Signals Behind the Data? Weekly Market Overview Hi Traders, It's been a rollercoaster month for those trying to interpret the latest economic indicators. Job numbers down, retail sales up, GDP revised higher… it's enough to make your head spin. The recent ISM manufacturing data, in particular, sent the S&P 500 tumbling, highlighting the market's sensitivity to each new release. A former Federal Reserve official recently weighed in on this phenomenon, suggesting that investors may be getting a bit too caught up in the day-to-day fluctuations of economic data. With an endless stream of information available, it's easy to lose sight of the bigger picture. The official likens the constant flow of data to a "bouncing ball," with each new release potentially sending mixed signals and creating confusion. While it's important to stay informed, an excessive focus on short-term data can obscure the underlying trends shaping the economy. Instead, investors are urged to pay closer attention to the fundamental structural drivers at play. Demographic shifts, technological advancements, regulatory changes, and the ongoing energy transition are just a few of the factors that will have a lasting impact, regardless of the latest economic snapshot. Of course, data still matters. The upcoming August jobs report is likely to influence the Fed's next move on interest rates. A strong report could lead to a smaller rate cut, while weaker numbers might prompt a more aggressive response. The former Fed official acknowledges the possibility that the central bank is slightly behind the curve in its fight against inflation. However, he believes a rate cut is still warranted, given the risks to the economy. Consumer spending, while showing signs of softening, remains relatively healthy. The employment picture, particularly for lower-income workers, is a key factor supporting this resilience. However, a significant rise in unemployment could quickly change the outlook, disproportionately affecting vulnerable populations. In this context, a cautious approach to monetary policy may be the most prudent course of action. By easing interest rates now, the Fed can provide some insurance against a potential downturn while remaining vigilant in its efforts to control inflation. Ultimately, the message is clear: don't let the daily deluge of data distract you from the broader economic narrative. The data may be useful for short-term trades, but those looking to make strategic decisions should keep an eye on the bigger picture. - The Team at Altos Trading In the next article, with tax rates potentially rising and speculation swirling, it's important to understand how these changes may – or may not – impact the stock market in the long run. Sponsor Flip Options Fast: A Simple Way to Target Big Potential Paydays Discover how a little-known trading technique could let you flip undervalued options for big potential returns—often within hours. With 3-4 opportunities a week, you won’t want to miss out. Now, we cannot promise future returns or against losses, but the next trade could be coming as soon as tomorrow. [Learn how you could get started now!]( By clicking the link above you agree to periodic updates from Wealthpin and its partners ([privacy policy]( Are Higher Tax Rates Really a Threat to Market Performance? The relationship between tax rates and market performance is a topic that generates a lot of heated debate, particularly in an election year. While it's a common belief that higher taxes will inevitably lead to a market downturn, the reality is far more nuanced. It's important to remember that tax policy is ultimately determined by Congress, not the President. Even if tax rates are scheduled to increase in 2026, the extent to which this will actually happen remains uncertain until the new Congress takes its seat. The idea that higher taxes will automatically cause a market crash stems from the assumption that less money in the hands of individuals and corporations will lead to decreased economic activity. While there's some truth to this, history shows that the relationship between tax increases and market performance is not so straightforward. There have been instances where tax hikes coincided with market declines, but there have also been plenty of times when the market continued to thrive despite increased taxes. For example, the expiration of Bush-era tax cuts in 2013 did not lead to the predicted market crash. In fact, the S&P 500 saw positive returns every year until 2018. Research further supports this disconnect. Studies examining the relationship between tax burdens and market returns have found no clear correlation. In fact, some studies even show that markets have, on average, performed well even in the face of tax increases. Of course, tax increases can have an impact on the economy, and this can indirectly affect market performance. But it's crucial not to let fear-mongering and political rhetoric cloud your judgment. As a long-term investor, focusing on a well-diversified portfolio and maintaining discipline are far more important than trying to predict the market's reaction to potential tax changes. History has shown that even if the market experiences a temporary dip due to tax increases, it's likely to recover in the long run. So, instead of getting caught up in the election-year hype, stay focused on your long-term financial goals and remember that a sound investment strategy can weather any political or economic storm. Sponsor [New Customers earn 5.25% APY* (variable)]( Store your money with Cash Reserve, a high-yield account built for peace of mind. New customers earn 5.25% variable APY*—that’s 13x higher than the national savings rate. ** Plus, your money’s FDIC-insured up to $2M†at our program banks and no limits on withdrawals and transfers. **The national average savings account interest rate is reported by the FDIC (as of 5/15/23) as the average annual percentage yield (APY) for savings accounts with deposits under $100,000. [Sign Up Now!]( Disclaimer: The Altos Trading Alert Newsletter is published as an information service for subscribers, and it includes opinions as to buying, selling and holding various stocks and other securities. However, the publishers of the Altos Trading Alert Newsletter are not brokers or investment advisers, and do not provide investment advice or recommendations directed to any particular subscriber or in view of the particular circumstances of any particular person. Altos Trading, including its owner, does not participate in any trades issued through the alert services. Subscribers to Altos Trading or any other persons who buy, sell or hold securities should do so with caution and consult with a broker or investment adviser before doing so. Trading securities and options involves risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade securities and options, and must meet suitability requirements. Past results are not necessarily indicative of future performance. Performance figures are based on actual recommendations. Due to the time critical nature of trading, brokerage fees, and the activity of other subscribers, there is no guarantee that subscribers will mirror the performance of the service. Performance numbers shown are based on trades subscribers could enter based on the trade alerts. Altos Trading, LLC assumes no responsibility for any losses incurred by any individual or entity as a result of trade alerts or strategies taught through courses or coaching services. 7154 W State Street Suite 169 Boise Idaho 83714 USA Disclaimer: The Altos Trading Alert Newsletter is published as an information service for subscribers, and it includes opinions as to buying, selling and holding various stocks and other securities. However, the publishers of the Altos Trading Alert Newsletter are not brokers or investment advisers, and do not provide investment advice or recommendations directed to any particular subscriber or in view of the particular circumstances of any particular person. Altos Trading, including its owner, does not participate in any trades issued through the alert services. Subscribers to Altos Trading or any other persons who buy, sell or hold securities should do so with caution and consult with a broker or investment adviser before doing so. Trading securities and options involves risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade securities and options, and must meet suitability requirements. Past results are not necessarily indicative of future performance. Performance figures are based on actual recommendations. Due to the time critical nature of trading, brokerage fees, and the activity of other subscribers, there is no guarantee that subscribers will mirror the performance of the service. Performance numbers shown are based on trades subscribers could enter based on the trade alerts. Altos Trading, LLC assumes no responsibility for any losses incurred by any individual or entity as a result of trade alerts or strategies taught through courses or coaching services. 7154 W State Street Suite 169 Boise Idaho 83714 USA [Unsubscribe]( | [Change Subscriber Options](