Of all the many issues that currently divide our nation, the one thing that pretty much everyone agrees upon right now is that the economy and job market are okay, but could be doing a whole lot better.
Of course acknowledging that problem and actually correcting it are completely different things, but it's something Wall Street veteran Hugh Johnson of HJ Advisors thinks could be drastically improved with a few key steps.
As we discuss in the attached video, Johnson has put together a wish list of 3 keys steps that he says would definitely get things growing again.
1) Tax Cuts! For Individuals and Corporations
That's right, people, free money. Johnson says good old fashioned tax cuts (or "tax reform" if you prefer) for individuals and corporations will actually result in higher overall tax collections.
"Maybe I've got to just cross my fingers and pray for this one," he says of the obvious uphill fight this action would face in Washigton, "but broadening the tax base and lowering tax rates, I think is going to generate more revenues."
The Johnson plan, however, has a catch, as it is not designed to be a windfall for the IRS.
"You've got to re-use those revenues for infrastructure spending that will really stimulate this economy," he says, adding that we need to really put together tax reform, increased revenues, and infrastructure spending for it to have the desired impact.
2) Incentivize The Repatriation of Foreign Earnings
Like the tax cut idea, this is also a hot button issue, but then again, this isn't about winning favor, it's about getting the economy going and boosting hiring. To that point, Johnson says corporations should be given a moratorium on the taxes they pay to bring foreign profits back into this country as long as they use the proceeds to buy equipment, expand plants, or fund research and development.
By doing so, trillions of dollars that are currently sitting in Swiss, Japanese, and German bank vaults would magically find their way home and be put to use here.
Apple alone is said have more than $50 billion dollars essentially locked-up overseas waiting for a favorable tax window to come home
3) A Little More QE, Not Less
Like most observers, Johnson believes that "the Fed and monetary policy has really done its part" to help the economic recovery and thinks the real bang for the buck now resides with Congress, or so-called fiscal policy. At a time when the notion of when to start tapering the Fed's $85 billion a month asset purchase program is being hotly debated, Johnson seems to err on the side of being a little too easy than a little too quick to tighten things up.
"A little bit more Q-E (is fine), but I don't think that is what is going to do it," he says.
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