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Whitaker-Myers Wealth Managers is an SEC-registered investment adviser firm. The information presented is for educational purposes only and intended for a broad audience. The information does not intend to make an offer or solicitation to sell or purchase any specific securities, investments, or investment strategies. Investments involve risk and are not guaranteed. Whitaker-Myers Wealth Managers reasonably believes that this marketing does not include any false or misleading statements or omissions of facts regarding services, investment, or client experience. Whitaker-Myers Wealth Managers has a reasonable belief that the content will not cause an untrue or misleading implication regarding the adviser’s services, investments, or client experiences. Please refer to the firm’s ADV Part 2A for material risks disclosures.

Past performance of specific investment advice should not be relied upon without knowledge of certain circumstances of market events, the nature and timing of the investments, and relevant constraints of the investment. Whitaker-Myers Wealth Managers has presented information in a fair and balanced manner.

Copyright (c) 2023 Clearnomics, Inc. and Whitaker-Myers Wealth Managers, LTD. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports posted on or via www.clearnomics.com or any affiliated websites, applications, or services are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company's stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments. The text, images, and other materials contained or displayed in this report are proprietary to Clearnomics, Inc. and constitute valuable intellectual property. All unauthorized reproduction or other use of material from Clearnomics, Inc. shall be deemed willful infringement(s) of this copyright and other proprietary and intellectual property rights, including but not limited to, rights of privacy. Clearnomics, Inc. expressly reserves all rights in connection with its intellectual property, including without limitation the right to block the transfer of its products and services and/or to track usage thereof, through electronic tracking technology, and all other lawful means, now known or hereafter devised. Clearnomics, Inc. reserves the right, without further notice, to pursue to the fullest extent allowed by the law any and all criminal and civil remedies for the violation of its rights.

Writer's pictureJohn-Mark Young

Election 2024: Navigating Financial Plans Amid Political Uncertainty

As the November 5 presidential election approaches, polls indicate a tight race between former President Donald Trump and Vice President Kamala Harris. With both candidates intensifying their campaigns in key swing states, investors may be concerned about the potential impact of either outcome on their investment portfolios.


The current political climate is characterized by deep divisions, leading to heightened emotions surrounding this election. In such an environment, investors must prevent political sentiments from interfering with their long-term financial strategies. As my friend Dave Ramsey consistently says, what happens in your house is so much more important than what happens in the White House. He goes on to remind listeners that he has made money under both parties and while specific policies can make it harder to be a profitable publicly traded company or small business, there is probably nothing any President can do to take down this beautiful country and economic power. That will be King Jesus's decision as to when that happens.


Speaking of our friend Dave Ramsey, recently, he came out on an episode letting the world know who he was voting for. That clip can be seen here. Additionally, he did an excellent interview with President Trump. That interview, where they mainly focused on his ideas around improving the economic climate for small businesses, can be watched or listened to here.


Estate planning faces uncertainty due to potential tax policy changes


While the election results may significantly affect our daily lives as citizens, voters, and taxpayers, it's important to separate political preferences from investment decisions. Historical evidence suggests that economic and market conditions tend to influence election outcomes rather than vice versa. Therefore, it's advisable to exercise your right to vote at the polling station but refrain from making investment decisions based on political leanings. How can investors maintain a balanced perspective in the coming weeks?


One of the most intricate areas affected by the election outcome is tax policy. The impending expiration of the Tax Cuts and Jobs Act (TCJA) at the end of 2025 creates uncertainty regarding the future of individual and corporate taxes, potentially leading to a "tax cliff." The candidates have divergent approaches to corporate taxes, individual rates, capital gains, tax credits, and other related issues.


It's essential to maintain perspective on tax policy, as these topics can be politically charged. While taxes directly impact households and businesses, their effect on the overall economy and stock market is not always straightforward. This is because taxes are just one of many factors influencing growth and returns, and various deductions, credits, and strategies can mitigate the impact of statutory tax rates.


From a historical standpoint, current tax rates are relatively low. This will remain true whether the top marginal tax rate is 37% or 39.6%. Given the growing federal debt, it's prudent for investors to anticipate potential tax rate increases in the future, regardless of the election outcome. Planning for this possibility, ideally with guidance from a trusted advisor, is becoming increasingly important.


Estate taxes represent an area where rates are particularly low by historical standards. This tax, levied on the transfer of assets to heirs after death, saw its exemption amount doubled by the TCJA. After inflation adjustments, the exemption has reached $13.6 million for 2024. Without further action, this would revert to the pre-TCJA level, adjusted for inflation, which economists estimate would be approximately $6.8 million per individual in 2026.


Despite estate taxes contributing only a small fraction of government revenue and affecting a limited percentage of the population, it has become a contentious political issue. The future of estate taxes will largely depend on the election results, including Congressional races. For many affluent households, this could significantly impact their tax and estate planning strategies.


Election results may influence global trade and tariff policies



The candidates also present differing views on potential trade policies, particularly regarding tariffs. While the trend towards deglobalization and reshoring of manufacturing is likely to continue, the approach to using tariffs for enhancing U.S. competitiveness and generating revenue may vary depending on the election outcome. It's worth noting that many of the tariffs implemented during President Trump's administration were maintained by the Biden administration.


Historically, tariffs played a significant role in trade and were a major source of U.S. government revenue. However, their importance has diminished in recent decades. The establishment of organizations and agreements such as the WTO, NAFTA, the USMCA, and others has helped reduce trade barriers among major partners. Nevertheless, tariffs have been periodically used to protect domestic industries and intellectual property, including sectors like steel, electronics, semiconductors, and agricultural goods.


For investors concerned about a potential trade war, it's important to remember that similar fears in 2018 and 2019 did not lead to the worst-case scenarios some had predicted. The economy remained robust during this period, with unemployment near historic lows and inflation virtually non-existent, despite being late in the business cycle. Ongoing negotiations between key trading partners eventually helped alleviate some concerns. As illustrated in the accompanying chart, the U.S. has maintained trade deficits with numerous countries across various trade regimes.


Economic growth has occurred under administrations of both major parties


Historical evidence demonstrates that economic growth and bull markets have occurred under administrations of both major political parties. While this may seem counterintuitive, it underscores the fact that politics often has a limited impact on the economy and markets. Specifically, factors such as the business cycle and broader trends like the advancement of artificial intelligence and technology, declining inflation, and a strong job market tend to have a more significant influence. I recently obtained my Advanced Certificate in Blockchain and Digital Assets from DACFP and I can't even begin to describe how bullish I am right now on the potential for blockchain technologies in the future. As a matter of fact, the future is kind of here in that we are already using blockchain in many situations that I would argue have nothing to do President Trump or Vice-President Harris. Here are two great examples.


1. Supply Chain Transparency and Traceability


Blockchain is revolutionizing supply chains by providing transparency and traceability from production to the end consumer. For example, major food companies like Wal-Mart are using blockchain to track produce, meat, and dairy from farms to stores. With blockchain, each step of the supply chain is recorded immutably, ensuring that consumers can trace the origin of products and verify authenticity, sustainability practices, and food safety. This reduces fraud, enhances food safety, and allows consumers to make informed choices.


2. Financial Inclusion Through Decentralized Finance (DeFi)


Decentralized finance, or DeFi, uses blockchain to provide financial services without traditional banks. Through DeFi platforms, people can borrow, lend, save, and earn interest on digital assets directly on the blockchain. This is especially impactful in regions where access to banking is limited, allowing millions of unbanked individuals to participate in the financial system, secure loans, and grow savings. DeFi helps foster financial independence, creating new opportunities for economic growth globally.


As you can see, Despite the perceived importance of this election, it's worth noting that policy changes are often implemented gradually due to the system of checks and balances in our political structure, and technology like that described above does not care about who sits in the White House. Campaign promises may differ substantially from what candidates can actually achieve once in office.


Regarding taxes, neither candidate is proposing a return to pre-Reagan era levels when top marginal rates reached as high as 94%. In terms of trade, while tariffs may increase, they are unlikely to reach the levels experienced during the Great Depression nearly a century ago. Keeping these facts in perspective is crucial when planning for the next four years.


The bottom line? While the election is significant for various reasons, its long-term impact on the stock market and economy is often overestimated. Economic growth has occurred under both Democratic and Republican administrations, and it's essential for investors to maintain perspective during this election season.

Whitaker-Myers Wealth Managers is an SEC-registered investment adviser firm. The information presented is for educational purposes only and intended for a broad audience. The information does not intend to make an offer or solicitation to sell or purchase any specific securities, investments, or investment strategies. Investments involve risk and are not guaranteed. Whitaker-Myers Wealth Managers reasonably believes that this marketing does not include any false or misleading statements or omissions of facts regarding services, investment, or client experience. Whitaker-Myers Wealth Managers has a reasonable belief that the content will not cause an untrue or misleading implication regarding the adviser’s services, investments, or client experiences. Please refer to the firm’s ADV Part 2A for material risks disclosures.

Past performance of specific investment advice should not be relied upon without knowledge of certain circumstances of market events, the nature and timing of the investments, and relevant constraints of the investment. Whitaker-Myers Wealth Managers has presented information in a fair and balanced manner.

Copyright (c) 2023 Clearnomics, Inc. and Whitaker-Myers Wealth Managers, LTD. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports posted on or via www.clearnomics.com or any affiliated websites, applications, or services are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company's stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments. The text, images, and other materials contained or displayed in this report are proprietary to Clearnomics, Inc. and constitute valuable intellectual property. All unauthorized reproduction or other use of material from Clearnomics, Inc. shall be deemed willful infringement(s) of this copyright and other proprietary and intellectual property rights, including but not limited to, rights of privacy. Clearnomics, Inc. expressly reserves all rights in connection with its intellectual property, including without limitation the right to block the transfer of its products and services and/or to track usage thereof, through electronic tracking technology, and all other lawful means, now known or hereafter devised. Clearnomics, Inc. reserves the right, without further notice, to pursue to the fullest extent allowed by the law any and all criminal and civil remedies for the violation of its rights.

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