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Senate leaders say they will consider repeal of Obamacare mandate



Senate Republican leaders reportedly said Tuesday they will consider including repeal of Obamacare’s individual mandate in their big tax reform bill.

That news came on the heels of an announcement by Sen. Rand Paul, R-Ky., that he will seek repeal of that mandate in an amendment to the Senate’s bill to “provide bigger tax cuts” to middle-income earners.

Bloomberg News reported that both Senate Majority Whip John Cornyn, R-Tex., and third-ranking Republican John Thune of South Dakota said repeal is under discussion, and would be raised at the Republican conference lunch Tuesday.

The moves came a day after President Donald Trump called for the tax bill to include such a repeal.

A repeal of the mandate could alleviate one concern held by some House Republicans about the the Senate’s version of the bill.

But it could also make it more difficult for the tax bill to pass because of worries by some GOP members about big drops in the number of Americans with health insurance that would result from repeal of the mandate.

The individual mandate requires nearly all Americans to have some sort of health insurance coverage or pay a tax penalty. Republicans have long opposed the mandate and promised to repeal it, only to fail in those efforts.

Paul, in a series of Twitter posts, said repeal “will fix a problem in the Senate bill where many taxpayers would see a tax increase because of the loss of state and local Tradebuddy.onlineincome tax] deductions” from federal taxes.

The Senate bill would repeal those state and local income tax deductions, which are most commonly used by federal tax filers in states that have high income tax burdens, which in turn tend to be Democrat-leaning states.

House Republicans from those states are worried they will suffer in the 2018 congressional elections if they support repeal of the deductions. The House had explicitly rejected inclusion of a repeal of the mandate in its version of the bill pending in that chamber.

Paul said repeal of the mandate “also allows an additional $300 billion+ in tax cuts.”

That’s because killing the mandate would lead to an estimated 13 million fewer people with health insurance by 2027.

In turn, the government would spend almost $340 billion less on subsidies for low-income people insured through Medicaid, and on subsidies for people who buy individual health plans sold on government-run marketplaces.

Trump, in his own tweet calling for the mandate’s demise on Monday, said the savings could be used to cut the top marginal income tax rate for the highest income earners to 35 percent with “all the rest going to middle income cuts.”

That differs from Paul’s stated motivation, which is to provide relief to middle-income taxpayers.

Republicans had called for repealing the mandate in a series of Obamacare repeal-and-replace bills they proposed since the beginning of this year.

All of those bills failed, in no small part because of concerns by several Republicans in the Senate that gains in insurance coverage for millions of Americans seen under Obamacare would be wiped out if the bills became law.

Sen. Susan Collins, R-Me., said Monday that she believes it is “a mistake” to combine repeal of the mandate with the tax bill, “because I think we’ll get no Democratic votes and I’d like this to be bipartisan.”

Collins, along Sens. Lisa Murkowski, R-Alaska, and John McCain, R-Ariz., had both voted against a GOP-sponsored bill in July that would have repealed the mandate.

Democrats in Congress universally oppose repeal of the individual mandate. But they don’t have enough votes on their own to block its repeal if all of the Republicans voted for such a move.


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Guess shares tank on lower-than-expected quarterly sales



Tradebuddy.onlines of Guess Inc. GES, +0.96% fell 12% late Tuesday after the retailer reported third-quarter sales that missed Wall Street expectations. Guess said it lost $2.9 million, or 4 cents a share, versus earnings of $9.1 million, or 11 cents a share, in the year-ago period. Adjusted for one-time items, Guess earned $10.4 million, or 12 cents a share, compared with $9.6 million, or 11 cents a share a year ago. Sales rose 3.3% to $554 million, compared with $536 million a year ago. Analysts surveyed by FactSet had expected adjusted earnings of 12 cents a share on sales of $564 million. Retail revenue in the Americas fell 11%, offset by increases in Europe and Asia, the company said.

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This Little-Known Chinese Stock Is on Fire — The Motley Fool



Chinese stocks have done reasonably well in 2017, with the Shanghai Composite Index up about 10%. Yet that’s lower than the 15% return of the S&P 500, and when compared with emerging markets overall and the MSCI EM Index’s 25%-plus return, China’s stock market has underperformed.

However, it’s been a strong year for stocks of Chinese companies listed in the United States through American depository shares (ADS). High-profile Chinese companies such as Alibaba (NYSE:BABA) and (NASDAQ:JD) have provided investors year-to-date returns of 106% and 52% as of this writing. Even better, shares of social-media live-streaming platform provider YY (NASDAQ:YY) have blown both out of the water. Below, you’ll find what you need to know about this company.

JD data by YCharts

YY has a long runway for growth

Like Alibaba and, YY benefits from demographic tailwinds. About 731 million Chinese citizens — more than half of the total population — had Internet access as of year-end 2016. That figure has rapidly increased, growing by approximately 19% per year since 2005. Not only are more Chinese citizens gaining Internet access, but the ranks of the middle class with disposable income are swelling. The Brookings Institute estimates middle-class consumption in the Middle Kingdom will grow 8.5% per year until 2030.

As the leading live-streaming mobile and PC provider, YY benefits from both increased Internet penetration rates and disposable income from a rising middle class. The company currently has 73 million mobile live streaming monthly active users, a 37% year-over-year increase. Look for user growth to continue from its host of online-dating, music, gaming, and sports sites.

YY had a strong quarter

YY’s run appears to be mostly supported by the financials. In the recently reported third quarter, the company increased net revenue 48% from last year’s quarter and net income per ADS by 52%, and the pace of that growth has been quite a bit higher than those who follow the stock closely had anticipated. The company expects strong top-line growth to continue, issuing projections for sales to grow in the fourth quarter by between 36% and 41%. 

Picture of Shanghai at night.

Image source: Getty Images

YY is relatively cheap

Unlike its Chinese peers Alibaba and, YY is cheaply valued, with shares currently trading at a forward earnings multiple of about 15 times what investors expect YY to earn in 2018. That’s attractive in comparison to the S&P 500’s corresponding forward multiple of about 20. Meanwhile, Alibaba and trade at much more expensive valuations of 36 and 42 times forward earnings estimates, respectively.

It’s not often you find a company growing its top and bottom lines approximately 50% while trading at multiples lower than the overall market. If you’re an investor in Alibaba and and are looking for more ways to profit from the demographic shift in China, put YY on your due-diligence list before Wall Street catches wind of the name.



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