The Financial Times reports Multinationals Pay Lower Taxes Than a Decade Ago. The article notes " Effective rates have fallen 9 percent since the financial crisis."

Brad Setser has a string of Tweets.

I am interested in the widespread belief the tax cuts will spur investment. That's an angle the article did not cover.

Here's another pertinent chart from the article, anecdotes again mine.

Trapped Cash Unleashed?

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Trapped Cash Myth

For starters none of that cash was "trapped" in the first place.

For discussion, please see Trapped Funds Myth: Foreign Cash Repatriation Boom in Reverse.


Moreover, history shows where repatriation holidays go: share buybacks, not investment.

Record Buybacks

Here's the real deal: Record Buybacks at Worst Possible Time.

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JPMorgan estimates $800 billion in buybacks this year, a new record. Companies will squander money in an obvious bubble.

Record Dividends

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Goldman sees dividends expanding to $515 billion.

Any company that says it will increase investment because of the cuts is likely outright lying (plans were already in place), is exaggerating the amount of the increase, or the amount of the increase is too insignificant to matter.

There will not be a trump investment boom. Instead, Trump's foolish tariff war will provide the exact opposite. For further discussion, please see Trump Provides Clarity to EU: "Big Deficit We Tax Cars".

Mike "Mish" Shedlock

Trapped Funds Myth: Foreign Cash Repatriation Boom in Reverse

The ongoing myth is that tax changes will ripple through the economy leading stronger growth and investment.

In Praise of a Corporate Tax Cut

Bloomberg View columnist Tyler Cowen, a professor of economics at George Mason University and Marginal Revolution blogger says "Republicans have science on their side when it comes to corporate tax reduction." Is Cowen right? If so why?

Foreign Direct Investment in US Goes Negative: Blame Trump's Trade Policy

FDI in the US should be soaring. Tax cuts make the US attractive and the US economy is strong vs most of the world.

Corker to Vote Yes on Tax Bill Following Revision Giving Him a Break

Senator Corker, the only Republican voting against the Tax bill, just changed his mind. Why? He benefits personally!

"Faster Inflation From Tax Cuts"

According to Bloomberg, as cited by ZeroHedge, the Fed believes there will be faster inflation from the Trump tax cuts.

Starve the Beast: Trump's Tax Cut Better for Businesses, Worse For Everyone Else

Corporate America is doing far better than most expected under Trump's tax cuts. But the cuts didn't pay for themselves.

Four Main Economic Drivers Sputtering: Saxo Bank Charts

Here's a collection of charts from Saxo Bank's CIO and Chief Economist Steen Jakobsen.

Tax Bill Adds $1 Trillion to Deficit (Without Cutting Taxes for Most)

Nonpartisan analysis, from several places, shows the Senate tax bill will all $1 trillion to the deficit. What's next?

Trump "Boom" in One Picture

Deficits have only been at this level in or shortly after a recession. Unfortunately, this is the new normal.