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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (60987)	7/9/2018 9:16:27 AM
From: E_K_S	Read Replies (4) of 78751

Re:T Did another 25% add @ $32.55/share on 7/5. It was a dividend capture play as well as a side ways portfolio trade to maintain exposure in telcom/internet since I sold 45% CTL high cost shares to harvest some losses. I plan to put proceeds back into CTL in 31 days. Also sold some 45% on high priced shares in KMI to harvest long term losses and lover my average cost. Will buy back those shares in 31 days as KMI cash flows have stabilized and s/d continue to grow w/ recent asset sales. Peeled off some some high priced shares of PPL and booked a small gain. These proceeds also went into the T Buy. PPL is not covering their dividend and recently have been issuing new shares w/ some of those proceeds to cover that dividend. Not a good thing. PPL has bought some solar assets in the U.S. and that is a net positive based on price paid and future revenue streams. I still like the stronger utilities w/ D as my favorite and continue to look at entry point to Buy. The long term value is in their pricing power in a regulated industry and a good point in the cycle to accumulate shares. What happens to Value w/ Trade & Tariffs? Been thinking about this is tariff war escalates and have been thinking of possible long term outcomes. Some have speculated that this is the first move in the transition to a U.S. VAT (Value Added Tax). I did not realize that many countries have a VAT (U.S. does not) and may/could be using tariffs to equalize the playing field. China has a 17% VAT as does the EU. There are two kinds of VAT rates: tax rates and levy rates. For small-scale taxpayers, the VAT levy rate of 3% is applicable. For the general taxpayer, VAT tax rates may vary from 17%, 13%, 11%, 6% or even 0%, depending on the nature of the goods or services involved. The VAT levy rate for general taxpayers is 3% or 5%. The VAT is like many small tariff's in the manufacturing process and all non-domestic consumer pay this hidden tax. I have been searching for hidden Value in domestic U.S. manufacturing companies (those companies that add-value in the supply chain) that may/could significantly benefit from a U.S. VAT. One analyst on Blommberg was suggesting that if/when a U.S. VAT is implemented, elimination of the Federal income tax could be possible and total revenues from the VAT would more than exceed those lost from the income tax. A local VAT would stimulate the further expansion of domestic manufacturing acting like another huge tax stimulus. Could this be the new model U.S. is headed for to compete w/ the foreign VAT's already in place by China & EU? When you look at what is in place, these hidden foreign VAT taxes are significant. Good Investing EKS

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