Mnunchin talks about tax reform and stocks
Ben Bernanke said the stock market was the first thing he looked at each morning.
With Goldman Sachs now running just about every part of the financial administration, it's no surprise that it's the scorecard for the administration as well.
"There is no question that the rally in the stock market has baked into it reasonably high expectations of us getting tax cuts and tax reform done," Goldman veteran and Treasury Secretary Steven Mnuchin said in an interview with Politico, adding regulatory relief is also priced in. "To the extent we get the tax deal done, the stock market will go up higher. But there's no question in my mind that if we don't get it done you're going to see a reversal of a significant amount of these gains."
In theory, none of this is negative. The stock market is a reflection of the economy to a large extent.
It's just troubling that it's seemingly their #1 barometer.
You wonder if any of them would be capable of getting something done that was good for the broader economy or the country, that would hurt the stock market or the corporate bottom line.
The answer: Not a chance. So it will be more record highs in the S&P 500 to infinity.
Separately, in the same interview, Mnuchin said it was unavoidable to cut taxes for the middle class and not the wealthy.
"So when you're cutting taxes across the board, it's very hard not to give tax cuts to the wealthy with tax cuts to the middle class," he said. "The math, given how much you are collecting, is just hard to do."
Sure, but contrast that with what he said earlier in the year.
"Any reductions we have in upper-income taxes will be offset by less deductions so that there will be no absolute tax cut for the upper class," Mnuchin told CNBC's "SquawkBox" then.
