How do we figure some media stock futures? Include more Presidential media -- TV and tweets -- into any financial calculations.
This came to light with regards to Amazon and its tax situation. President Trump says the ecommerce retail giant pays little or nothing -- according to a Thursday tweet, which was picked up on many TV news networks.
“I have stated my concerns with Amazon long before the Election. Unlike others, they pay little or no taxes to state & local governments, use our Postal System as their Delivery Boy (causing tremendous loss to the U.S.), and are putting many thousands of retailers out of business!”
That missive had one analyst on CNBC mulling the idea -- somewhat half jokingly -- that Trump's tweets should be more strongly considered when it comes to future stock market and financial performance.
This isn't the first time analysts have had to consider wild, off-the-cuff tweets from the President -- stuff without much backup.
Here is the reality: Amazon paid $957 million in federal taxes in 2017, according to The New York Times. Some years ago -- between 2008 and 2012 -- Politifact says Amazon's combined tax burden also fell well below the official U.S. corporate tax rate of 35% -- just a 9.3% effective federal income tax.
Thanks to a new tax code pushed by Trump, the corporate tax rate has now dropped to 21% from around 35%. Very few companies actually have paid that rate in recent years, and the effective corporate tax has been in the low 20% range for some time.
No matter -- lower taxes are good for companies, according to Trump. And perhaps even the economy. Global trade wars, not so much.
But we need to factor into Trump's comments that Jeff Bezos, CEO of Amazon, personally owns The Washington Post -- the newspaper that has broken, along with The New York Times and others -- many hard-hitting stories about Trump.
And by the way -- how much did Trump businesses pay in taxes? We don't have any idea, because the Trump Organization is private. His personal tax returns have been in a perennial state of audit.
Media via tweet via TV via Presidential tweet counts for something. On Wednesday -- when a report from Axios originally spoke of the Trump effort to take on Amazon -- the stock sank 7% before recovering. On Thursday, it recovered a bit more.
Amazon isn’t alone. Trump has ripped into countless other companies -- including Time Warner (especially when it comes to CNN), Apple, Boeing and General Motors. One report in early 2017 said Trump laid into 62 companies via tweet over a specific period.
Consider all this when looking at the stock market -- with media stocks on alert.