Everybody has been incredibly focused on two pieces of the present tax offer: its have an affect on on their cash flow (incredibly easy to understand), and how it will have an affect on stocks (also easy to understand). On the other hand, there is 1 big influence of the tax program that has not been discussed a lot at all-its influence on company bonds. The base line for organizations is that the new tax program would enable them to carry a good deal of income home (minimizing their require to issue personal debt), and at the exact time, get rid of the company interest deduction, generating it more pricey to issue bonds. Due to the fact of this, the total of new issuance seems established to slide, which would most likely have the influence of boosting demand, and rates, for existing company personal debt.
FINSUM : This seems like it has the makings for a significant rally, as fantastic bonds turn into more scarce at accurately the exact time as toddler boomers require more cash flow for retirement.