US Treasury Secretary Mnuchin: tax bill will be ready by December - ANZ

Analysts at ANZ noted the bold claims from US Treasury Secretary Mnuchin .

Key Quotes:

"In an interview overnight, not only did US Treasury Secretary Mnuchin give his “absolute guarantee” that the tax bill will be ready for Trump’s signature by early December, he also stated that “to the extent we get the tax deal done, the stock market will go up higher”, while also adding that “... if we don’t get it done you are going to see a reversal of a significant amount of these gains.” That is quite a bold prediction, especially when a number of other markets appear to have largely priced out any prospects for reform. 

Certainly, right now, some of the market’s fundamentals look okay. Bloomberg report that of the 52 members of the S&P 500 that have reported earnings, more than 80% have beat expectations. It’s early days, but the ‘E’ in ‘P/E’ appears to be keeping up its end of the bargain. Rather than tax reform, arguably one of the biggest issues on the horizon for all asset markets is how they will handle QT (quantitative tightening) which is just around the corner."