Perhaps the biggest and most significant event to happen to the markets this year – and possibly since the 1980s – has to be the recent Republican tax plan.
With the enacted law, corporate taxes are set to shrink by a ton and firms will have unprecedented access to their cash hoards overseas. With all of this extra money now filling their coffers, investors have been riding high on the potential to see more of that cash hit their wallets.
Well, don’t hold your breath.
While dividend raises are expected, the bulk of that newfound money won’t benefit investors directly. It turns out that buyback activity is skyrocketing since the announcement of the tax plan. For investors – especially income seekers – that might not be as lucrative as it seems.