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Have You Ever Willingly Paid More Taxes Than Required?

CAMS Weekly View from the Corner – Week Ending 6/23/17

June 26, 2017

“I am apt to believe that it will be celebrated, by succeeding Generations, as the great anniversary Festival. It ought to be commemorated, as the Day of Deliverance by solemn Acts of Devotion to God Almighty. It ought to be solemnized with Pomp and Parade, with Shows, Games, Sports, Guns, Bells, Bonfires and Illuminations from one End of this Continent to the other from this Time forward forever more.” Founding Father and 2nd President of the United States – John Adams’ Vision of Future 4th of July Celebrations

Didn’t we just pass through the unofficial start of summer with Memorial Day weekend?  In typical summer fashion the season is clicking by quickly as a week from today will be the eve of our national Fourth of July celebration.

With this, today’s installment will be the last until July 10th as we fully honor the historical significance of this upcoming day.  And speaking to historical significance, our header quote shares a well known quote from John Adams extracted from a letter he wrote to his wife Abigail relative to what he saw in the future on this date for the young country attempting to stake its independence.  Fair to say his vision was accurate eh!

Speaking to our title today the above chart addresses tax receipts of the U.S. Treasury dating back to 1960.  Mr. Griess over at the Chart Store ( compiles this data in an informative visual to get a sense of whether tax receipts are growing or deteriorating.

Realizing the vast majority, if not the entire population, doesn’t strive to pay more taxes than what is required of them gives this data, from an economic perspective, some validity as a general economic gauge.  Outside of any major tax policy changes, which we have not had of late, the trend of tax receipts can be viewed as a general sign of strengthening or weakening conditions within the nation’s economy.

The lower pane of the chart reflects the year-over-year growth of said receipts.  As depicted, as well as what has been seen in several other economically oriented pieces within these Weekly View’s of late, weakness has been seen in the previous couple of years up to current day.

Through the history shown we can also see these types of established down trends have frequently occurred around recessions denoted by the bold vertical grey bars.

At the risk of sounding like a resounding gong here in the Weekly View – we simply need more growth.  Realizing our current stock market is valued in the historically high range stronger economic activity is necessary to support these levels via significantly stronger sales and earnings from the companies that make up the stock market.

If these Tax Receipt trends continue it will be pointing to more concerns on the strength of the economy and hence larger concerns for the stock market overall.  We continue to watch with vigilance.

Enjoy the mid-summer celebration and tip the hat to one John Adams as you celebrate in your way for his amazing vision a couple of centuries ago!

I wish you well…


Ken Reinhart

Director, Market Research & Portfolio Analysis

Portfolio Manager, CAMS Spectrum Portfolio


H&UP’s is a quick summation of a rating system for SPX9 (abbreviation encompassing 9 Sectors of the S&P 500 with 107 sub-groups within those 9 sectors) that quickly references the percentage that is deemed healthy and higher (H&UP).  This comes from the proprietary “V-NN” ranking system that is composed of 4 ratings which are “V-H-N-or NN”.  A “V” or an “H” is a positive or constructive rank for said sector or sub-group within the sectors.

This commentary is presented only to provide perspectives on investment strategies and opportunities. The material contains opinions of the author, which are subject to markets change without notice. Statements concerning financial market trends are based on current market conditions which fluctuate. References to specific securities and issuers are for descriptive purposes only and are not intended to be, and should not be interpreted as, recommendations to purchase or sell such securities. There is no guarantee that any investment strategy will work under all market conditions. Each investor should evaluate their ability to invest for the long-term, especially during periods of downturn in the market. PERFORMANCE IS NOT GUARANTEED AND LOSSES CAN OCCUR WITH ANY INVESTMENT STRATEGY.

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