commercial finance association chicago

2016 Election

Impact on business, jobs and lives

Problems and Solutions

US & Intl Economic Situation

2016 Presidential Race

Future Growth

US Dollar +25%

3yr Oil and Nat Gas

Rate Dilemma

“There are limits to what monetary policy can and, indeed, should, do. The burden

must also fall on fiscal and other policies to do their part to help create conditions

conducive to economic stability.”

SF Fed President John Williams

Productivity=Growth

The 10yr Debt Time Bomb

Policy solutions for growth

Free Trade=lower tariffs

Reg. Relief=reduced costs

Tax reform=capital formation w/incentives

Infrastructure=efficiency

Energy Production

Trump Econ/Tax PlanCut Corp& Pass thru

to 15%Carried interest as

ordinary1x 10% Repat Tax

Ag TPP and NAFTAImpose tariffs on imported goods

Big Drop in InterestDeductibility

New $500B infrastructure Full expensing!

100 Day Energy & Reg Plan

Energy Platform:Save coal industry,

Pass Keystone, Lift moratorium for energy on

Fed landsCancel Paris Climate Agreement

Rescind and Reform: Obama executive actions,

Climate Action Plan, WOTUS,

Obamacare, Dodd-Frank

Trump biz plans help/hurt

Help: big tech & big pharma

Hurt: debt heavy balance sheets

Help: industrials & manufacturers

Hurt: free trade

Help: energy production

Help: Transportation/Engineering

Help: banking

The Good and the Bad

Source: Tax Foundation

CLINTON PLAN

Fair share C tax

No Free Trade

Exit Tax

$275B Infrastructure plan

Extend/expand Obama regulation

programs

Big Change to Cap Gains

Fin Reg & Energy Plan

500mln solar panels by 2021Implement Clean Power Plan &

Paris Agreements$60B Clean energy challenge

Risk fee on the largest financial institutionsNo hedge fund investing

Hold senior bankers accountable for lossesNo financial firm is ever too big or too risky

HFT tax, close carried interest

Clinton plans help/hurt

Hurt: MNCs competitiveness

Hurt: raises taxes on top earners/capital formation

Help: transportation/enginering

Help: energy/alternatives

Hurt: energy/hydrocarbon production

Hurt: banking

Good, Bad and Complicated

Source: Tax Foundation

2016 RecapClinton:

biz tax hikes build on regscap gains taxno free trade

big alternativesbig infra

create pathway

Trump: biz tax cutsreduce regs

cap gains cutno free trade

big hydro carbon big infra

build a wall

Source: PIIE

Major Credit Issues

Regulatory Burden

Politics/Election fat tail

Slow growth & low rates

Policy solution summary

Future Growth Solutions

AI, Big Data, Analytics

Fintech

Reg Tech

Focus on what your own company does best — for instance, identifying investment

themes, assessing credit exposure, managing counterparty risk, or executing and settling financial transactions — and

then tap into the FinTech pool for innovation that can support or expand upon your organization’s core market.

PWC: 2016 Financial Services Trends

Big Data, Analytics, AI

Fintech

Block Chain isn’t just for Bitcoin

Robo advisors: Betterment & Wealthfront

Real estate crowdfunding: Peer Street, Real Crow, Realty Mogul

Digitally Enabled Lenders

Regtech: what it needs to solve

Business model risk

Failure resiliency

Legal structure simplicity

Final Thoughts…