On Marginal Revolution, Tyler Cowen quotes from a news item in the Financial Times: “There are several investment implications of Trump back in the White House,” said Jack Ablin, chief investment officer at Cresset Capital. “[Most notable would be] a higher-for-longer Fed, as monetary policymakers increase the likelihood that the corporate tax cuts will be extended next year.”
Did you spot the error in the quote from Jack Ablin? Neither Tyler nor, as far as I can tell, any of his many commenters did.
The corporate tax cuts, if by that you mean the drop in the corporate tax rate to 21%, don’t need to be extended next year because they don’t expire next year. They are one of the few parts of the 2017 tax cut that are permanent unless Congress explicitly changes them. And thank goodness for that because they are one of best parts of the 2017 law. (The other one is the restriction on the deduction for state and local taxes, which does expire next year.)
I’ve seen a number of people claim online that the cut in the corporate income tax rate was temporary. I corrected a Reason writer who made that claim. To his credit, he updated his post to reflect the truth.
Understanding Lease and Its Implications
In the context of business and finance, understanding what is a lease becomes crucial. A lease, by definition, is a contractual arrangement where one party, known as the lessor, grants another party, known as the lessee, the right to use an asset for a specified period in exchange for periodic payments. The lease meaning extends beyond mere possession; it encompasses the responsibilities and benefits associated with the asset during the lease term.
The lease definition varies depending on the type of lease agreement. There are primarily two types:
- Operating Lease: This is typically short-term and does not transfer ownership rights of the asset to the lessee. The lessor retains most of the risks and rewards associated with ownership.
- Finance Lease: Also known as a capital lease, this type is long-term and often results in the transfer of ownership rights to the lessee by the end of the lease term. The lessee assumes most of the risks and rewards associated with ownership.
Businesses often opt for leasing as it provides flexibility and can be more cost-effective than purchasing assets outright. It allows companies to manage cash flow better and keep up with technological advancements without committing large amounts of capital upfront.
In conclusion, while political and economic landscapes may shift, understanding fundamental financial concepts like leasing remains essential for making informed business decisions.
