A Decade Of Out-Performance: Inside WisdomTree's Dividend-Weighted Strategies
A decade ago, WisdomTree changed passive investing with the introduction of a sweeping series of dividend-weighted indexes.
WisdomTree Chief Investment Strategist Luciano Siracusano discusses our approach to dividends and how several WisdomTree
strategies outperformed traditional beta benchmarks over the past 10 years.
Below you will find links to our latest whitepapers, investment cases and current research.
You can also read economic and market commentary from our thought leaders and connect with us on social media.
There is a reason people always say to buy quality. In furnishings and retail goods, you tend to get what you pay for, and higher-quality goods, though they may cost more up front, last longer and ultimately may provide a better value down the road. These lessons can be applied to investing as well. Focusing on quality characteristics may actually lead to outperformance. And while it may not sound as familiar as focusing on growth or value, it is, in fact, the cornerstone of many investment approaches, including that of Warren Buffett.
Recently, the naysayers on currency hedging have come out in full force, advising investors not to hedge currency risk. Some of these naysayers are with reputable firms. Even so, I believe their negativity toward currency hedging is misleading.
As we have seen recently, with actions from the Bank of Japan and the European Central Bank, the preferred way to stimulate the economy these days has been through aggressive monetary easing policies, and one beneficial impact is a weaker currency. If South Korea follows in their footsteps, we think it will be positive for corporate profitability of exporters and the equity markets, but not for the currency, so we would advocate for a currency-hedged equity vehicle.
Europe has been one of the primary risks for the global economy—with sluggish growth, over-leveraged countries and banks being prime concerns for many investors. We believe that tides are changing due to shifting policy winds among central banks. We believe that the European Central Bank's expanded asset-purchase program will continue to weaken the euro against the dollar and provide support for local equity markets.
The market environment is always changing, and the rebalance process plays an important role in ensuring that an Index weights back to its fundamentals. In this piece, we have attempted to showcase how the rebalance process forces the discipline of reweighting back to the fundamentals and the beneficial impact the process has on valuation ratios.
The WisdomTree annual rebalance is a key element of the added value of WisdomTree’s Index methodology. We interpret another year of double-digit dividend growth as a very positive indicator of underlying market fundamentals and believe it helps provide a notable foundation for potential future gains.
We’ve seen growing interest in the degree of exposure to state owned enterprises (SOE) in various investment strategies. State owned enterprises are typically defined as companies that are either wholly or partially owned or operated by a government. Some investors feel government ownership can negatively impact the operational aspect of a company because government owned companies can be potentially influenced by a broader set of interests beyond generating profits for shareholders.
Each year, the rebalancing process refreshes the constituent weights of WisdomTree Indexes, moving them back toward a measure of relative value. As is the case with any approach looking to take advantage of the relatively less-expensive part of an equity market, the larger uncertainty regards not whether the stocks are over- or undervalued, but rather how long it will take broader market participants to actually respond and start pushing up prices.
My trip to Japan reinforced my views that Japan should be one of the most preferred destinations for global investment capital over the coming years. Japanese valuations have come down as Japanese earnings have grown more than stock prices. There is increased coordination from the government and central bank to reignite inflation and end the deflationary slump once and for all.
A common perception is that smart beta indexes always involve a small-cap bias in their construction. This is not true for WisdomTree’s broad-based and large-cap Indexes, which often have a larger-cap bias relative to traditional market cap-weighted indexes. We quantified in this piece the extent of that large-cap bias. We also addressed the comment that smart beta indexes inherently are value-tilted strategies.
Recently, currency-hedged equities have gained traction to neutralize the FX risk and target the local stock market returns. I have been talking to clients about currency-hedged strategies for much of the last five years, and virtually all conversations start like this: “Why should I hedge my currency risk?” But that is perhaps the wrong starting point. A more natural starting point to me is this: Why is it beneficial to add currency risk on top of local equities?
We feel investors could benefit by including exposure to European equities in a diversified portfolio over the long term. With potential economic green shoots perking up in the European landscape, the time could be ripe to consider the tools and options available across European equity indexes.
2013 marked a particularly strong year for equities in the developed international space, which, along with the United States, led the charge among global equity markets. Numerous macroeconomic tailwinds buoyed sentiment surrounding the developed international markets, including the eurozone returning to positive growth in the second quarter of 2013 and the Bank of Japan delivering bold monetary targets, reflecting overall accommodative monetary policies from central banks.
Each year, WisdomTree believes it is important to reset Index weights and exposures away from what has been driven by share price performance and toward what has actually occurred in terms of fundamentals. The following analysis focuses on the WisdomTree Europe Indexes, especially in the small-cap segment.
The WisdomTree annual rebalance is a key element of the added value of WisdomTree’s Index methodology. We interpret Japan’s current valuations and double-digit dividend growth as a very positive indicator of underlying market fundamentals. We believe these fundamentals, coupled with the ongoing third-arrow reforms, should help provide a notable foundation for potential future gains.
WisdomTree has one of the broadest sets of Indexes focused on international equities that are not weighted by market capitalization. In essence, we are looking to illustrate how these Indexes with at least five years of performance history were exposed to various factors.
Recently, European markets have performed strongly, with investors focusing on the economic recovery that has been building momentum. It is becoming difficult to remember that a few short years ago there was widespread debate about whether the European Monetary Union (EMU) would continue to exist.
A wide array of strategies are starting to have live performance histories greater than five years, making them eligible for consideration across a broader clientele. What are these various smart beta index strategies really doing when one looks under the hood?
When investors think of dividends, they tend to think of mature large-cap companies as the primary source, and as a result, we feel that many investors mistakenly overlook potentially attractive income options. Here we will discuss one segment of the market that often gets overlooked in the hunt for income-producing asset classes—mid- and small-cap dividend payers.
WisdomTree has compiled a Japan Strategist roundtable—a compilation of views from three of the most widely followed Japan investment strategists. In separate one-on-one interviews, we asked these strategists to share their views on Japan’s equity markets, the economy, government initiatives and the currency.
WisdomTree conducts the annual rebalance of its U.S. Dividend Index family in December, with the annual screening date occurring on the last trading day of every November. This rebalance provides a plethora of data about how dividends for the U.S. equity markets have changed over time.
The market environment is always changing, with some years notable for their performance extremes. The November 30, 2012, to November 30, 2013, period was quite strong, and we believe that it could be beneficial to take some chips off the table redeploying them into areas that may not have performed as strongly.
Since prime minister Shinzo Abe’s election on December 16, 2012, investors have embraced the economic resurrection plan being referred to as “Abenomics,” sending Japanese stocks higher and the yen lower. A critical aspect of Abe’s plan is to extinguish the deflationary forces that have gripped Japan’s economy for the last 15 years. In light of the committed pursuit of Abenomics, we believe there are three important trends investors should be positioning for.
Europe’s economy experienced six straight quarters of negative economic growth—or contraction—before returning to a positive growth rate—or expansion—in the second quarter of 2013. The recovery in Europe has been supported by accommodative monetary policy, low inflation and a moderation in fiscal austerity. Consumer spending has improved, and manufacturing surveys are pointing toward expansion. This stabilization of the European economy is encouraging, and many have begun to look for investment opportunities arising from this nascent recovery.
In this market insight, we highlight the recent performance of the small-capitalization market around the globe and discuss important considerations for further allocations from today’s levels. Adding exposure to small caps can offer increased diversification and return potential, but there are critical differences in investment strategies.
Amid the noise of recent central bank activity, WisdomTree rebalanced its India Earnings Index on September 20—the same day the new governor of the Reserve Bank of India (RBI) held his first policy meeting and two days after the U.S. Federal Reserve (Fed) announced its monetary policy decision. The timing of this Index rebalance and the RBI meeting was a coincidence—the Index rebalance occurs the same time every September.
One of the major themes that we believe will drive much of the global economy over the coming years is the rise in potential growth from emerging market (EM) consumers. In this Market Insight, we will discuss the key trends in the growth of the emerging market consumer and discuss the new Index we have created and how it is positioned in comparison to traditional emerging market equity indexes.
Lately all eyes have been focused on the Federal Reserve (Fed) and its accommodative monetary policies. Since the 2008–09 global financial crisis, the Fed and central banks around the world have embraced policies to provide ample liquidity to the markets with the goal of keeping interest rates low and credit flowing. However, as the U.S. economy improves, one must consider the possibility of the Fed ending the extraordinary measures it has been taking. Starting in May this year, on just a hint of the Fed possibly dialing back its bond purchases, longer-term interest rates in the U.S. rose considerably.
When looking at some of the broad emerging market indexes or even indexes that focus on valuation criteria for the emerging markets, you’ll find them to be among the least expensive parts of the global equity markets today. But not all indexes, sectors or countries share those same low valuations, so we will explore the areas where the valuation opportunity may receive the highest emphasis.
In this Market Insight, we discuss WisdomTree’s unique stock selection approach employed in the new WisdomTree Emerging Markets Dividend Growth Index, which are actually the same selection factors and weighting process as used for our U.S. and global ex-U.S. dividend growth Indexes. We’ll also have a general discussion on the recent environment for dividends and equity prices in the emerging markets to provide some present-day context on the investment opportunity set represented by this region and asset class.
With the introduction of “Abenomics” to Japan—and its impact on yen weakness and equity market strength—the benefits to currency hedging were on prime display. A side effect of this Japan story has been greater interest in applying the same type of currency hedged strategy to Europe. However, we do not believe investor interest in currency hedging stops there.
Over the past decade, the emerging markets have been one of the lone bright spots of economic growth. Each year, one of the most interesting aspects of the WisdomTree Indexes is the point in time when the global Dividend Stream® is monitored for growth in order to refresh the weights of the underlying constituent companies. This year, we present some of those results, with a special emphasis on the dividend trends exhibited in emerging markets.
WisdomTree has just introduced a strategy in the U.S. focused on dividend growth that goes beyond screens that look only at historical dividend increases. In order to unify this concept across different equity market regions, the same methodology is now being applied to the WisdomTree Global ex-U.S. Growth Index. Essentially, in the world outside of the U.S., we compare this new approach to strategies that incorporate backward looking dividend growth screens in various ways.
There is no question that investors are drawn to the idea of dividend growth—potentially more so today than in the past due to the ongoing stimulative monetary policies of the Federal Reserve (and other central banks around the globe). While there is no way to know with certainty what will happen in the future, we believe that our dividend growth methodology applies a logical framework of analysis to essentially increase the probability of placing greater weight in companies that have the best chance of raising their future dividends.
While dividend growth of firms in the U.S. has accelerated strongly in recent years, the types of companies driving that growth have changed. We believe that index methodologies focused on dividend growth that has occurred in the past through backward-looking dividend growth screens may not be flexible enough to respond to these changing trends, ultimately having the potential to capture the dividend growers of tomorrow.
When people think of emerging markets from a single country perspective, it’s quite clear that they think of China first, but beyond that the picture gets much murkier. In our analysis, we examine other emerging markets through the levels of assets tracking the performance of country-specific equity market indexes. Our conclusion is that we believe investors may be under-allocating to India.
In our last market insight, we discussed one segment of the market that often gets overlooked in the hunt for income-producing asset classes—mid- and small-cap dividend payers in the United States. In this piece, we extend the analysis of dividend-paying stocks by market capitalization segment beyond the United States to developed international markets. We believe the benefits of looking beyond large caps and into mid and small caps are, in many ways, even stronger in the international markets.
Income is the story of the day—notably the lack of any reasonable levels of income from such traditional sources as bonds and money market investments. Many investors are looking beyond traditional asset classes for income generation but have forgotten mid- and small-cap dividend paying equities. At WisdomTree, we believe mid- and small-cap dividend payers deserve a larger allocation in most investors’ long-term portfolios—particularly portfolios targeting income strategies.
There are many reasons to be positive on Asia’s economic growth potential within the coming years. Even after some positive performance, we believe that these stocks are in a “valuation sweet spot” relative to the dividends that they have paid. Additionally, for those looking for potential risk mitigation, we introduce the idea of exposure to Asian debt.
Our research shows that the prices of emerging market equities are relatively low, which makes us bullish about the prospects for emerging market equities in 2013. Drilling down further, Morgan Stanley research has showed that emerging market defensive stocks could be relatively expensive compared to their cyclical counterparts. We believe that the current positioning of WTEMHY takes advantage of both of these circumstances.
Every year, WisdomTree screens and rebalances its domestic earnings family of Indexes. This year, we recognize the need to issue our take on a crucial question: Are earnings peaking? While there is no way to truly know the future, within this piece we offer our analysis of the U.S. Earnings Stream and what we believe that data indicates with respect to a potential peak.
A popular refrain amongst investors has been: “Are dividend-paying stocks becoming expensive?” We have addressed this question in numerous prior commentaries, but we now employ a fresh approach comparing dividend growth to price appreciation. Ultimately, we believe that an environment supportive of strong dividend growth can also have the potential to be supportive of strong equity performance for dividend-payers.
At WisdomTree, our Index construction process depends on continually analyzing such risks as individual security influences, country biases or significant sector concentration. As of the November 30, 2012, Index rebalance, WisdomTree implemented a 25% sector cap on domestic equity Indexes to help mitigate sector concentration risk. We think these caps should enhance Index diversification and make the Indexes more attractive benchmarks for their representative segments of the dividend-paying stock universe.
WisdomTree’s annual rebalance based on the November 30, 2012 Index screening saw a new, record-high dividend stream, finally surpassing the prior high set on November 30, 2007. A major component of this year’s nearly 16% growth in the dividend stream related to companies—like Apple—initiating payments of regular dividends. Within this piece, we analyze the landscape of dividend growth within U.S. equity markets and how this contributed to sectors increasing or decreasing their weights within certain WisdomTree Dividend Indexes.
Vanguard shook up the landscape of passive investment vehicles with its announcement of a switch of index providers from MSCI to FTSE for its international and emerging market equity exchange-traded funds (ETFs). We believe that the introduction by Vanguard of the FTSE EM as a new major player in emerging market equity indexes serves as a potential wake-up call, because, as investors begin to question and analyze their emerging market equity exposures, they may also have the opportunity to recognize that alternative approaches to emerging market equity indexes exist.
We believe Japan-based multinational companies that generate the bulk of their revenues from markets outside of Japan are more likely to benefit from a weakening yen. Companies with a purely Japanese revenue base, on the other hand, are unlikely to benefit from a weakening yen, especially if imported materials are part of their production process. Essentially, while a weakening currency can make exports more attractive for foreign consumers, it can also make imports less attractive as these prices would tend to increase as the currency weakened. It is with this economic reasoning in mind that we have added the selection requirement, to the Index methodology, for Japanese companies to derive less than 80% of revenue from Japan to qualify for Index inclusion.
The dividend-paying equity landscape within the U.S. is evolving rapidly, and we believe the concepts of "growth" and "value" can be helpful in categorizing the different types of dividend-focused indexes being created to measure the performance of these stocks. Ultimately, just because an index has a dividend growth screen for determining constituent eligibility does not mean that it will necessarily capture all varieties of dividend growth. Similar to blending the attributes of different value and growth market capitalization-weighted indexes, we believe there could be potential benefits to analyzing the blended attributes of different value and growth dividend-focused indexes.
Recently, a hotly debated question has been whether dividend-paying equities might be getting expensive or approaching so-called “bubble” territory. Of the four “high dividend sectors” (Utilities, Telecom, Health Care and Consumer Staples), we believe three of these may be attractively valued, at least relative to the past 20 or so years.
In 2012, India’s equity markets have performed well compared to the broader MSCI Emerging Markets Index and have provided positive absolute returns so far this year. The WisdomTree India Earnings Index rebalance has taken effect and reweighted securities with an emphasis on those companies that have grown their earnings over the past year. We believe India’s long-term economic growth prospects remain intact and think that the most prudent way to access the Indian equity market is by focusing on companies with strong earnings and fundamentals.
We believe that China’s equity market has the potential to provide compelling opportunities, but traditional market cap-weighted approaches to Chinese equity indexes are currently susceptible to unique concentration risks, namely in Chinese financials. At WisdomTree, we have developed what we believe is a rather unique way to measure the performance of China’s equity market while mitigating what we see as a large potential risk of traditionally market cap-weighted indexes of China’s equities: sector concentration.
As dividend growth continues to be a popular topic in today’s market environment, one question we are often asked is what “screens” WisdomTree (WT) employs to capture dividend growth. Our answer: none. Companies that do not pass dividend growth screens involving significant lengths of time tend to be either new payers or those that previously cut but then reinstated dividends—precisely the types of firms driving dividend growth today.
Europe has recently been mired in turmoil, and both its equity market and the euro have exhibited uncertainty. However, investors may find that the markets mirror sovereign risks rather than specific company fundamentals, which creates opportunities for those aware of the risks. One of the primary risks for investors remains the currency movements of the euro compared to the U.S. dollar, but we think exporters who can execute in such an environment could benefit from a weakening euro, which may stoke demand for their products in the global market. If this scenario plays out, an investor may be better positioned in a portfolio of dividend-paying equities that derive more than half their revenues beyond Europe while hedging the euro.
Banking used to be a relatively simple business. Customers would make deposits, banks would make loans, and this interaction would contribute to economic growth. In more recent periods, banks have started operating more like hedge funds, becoming involved in ever more complex assets with increasing amounts of leverage—potentially enhancing returns during positive markets but worsening losses during difficult ones. A recent issue involving financial firms concerns potential manipulations of the LIBOR, a global benchmark rate to which trillions of dollars’ worth of borrowing are tied.
During January and February of 2012, policy makers around the world seemed to breathe a collective sigh of relief. Global markets appeared to largely shrug off the immediacy of the troubles in Greece and its repercussions for other debt-plagued European countries. As a result, investors embraced so-called “risky“ assets, like those associated with EM. But the market’s tone started to change in March following weakness in economic data. Investors then sought safety in United States Treasuries and German Bunds as Greece returned to the headlines in May—this time with Spain in tow. Risk sentiment has improved in recent weeks on the heels of positive surprises emerging from the Greek elections, the Spanish bank bailout, and the most recent EU summit. But investors remain very leery, fatigued by the stream of headlines and false dawns.
Over the past decade, the emerging markets (“EM”) have been one of the lone bright spots of economic growth. Additionally, they have been leaders of global dividend growth. However, part of this story changed over the trailing 12 months ending May 31, 2012 (“the period”), the most recent annual screening date for the WisdomTree (“WT”) global dividend Indexes.
Global portfolio allocations often subdivide assets tied to the “developed world” and the “emerging world.” Strong underlying economic prospects and favorable demographics often attract people to the “emerging markets,” but increased risk associated with these areas may restrict allocations.
Emerging market equities have been off to a fast start through the first quarter of 2012, as the MSCI Emerging Markets Index gained just over 14% from December 31, 2011 through March 31, 2012. Emerging markets are currently some of the lone bright spots in terms of global economic growth, but emerging market equity performance is certainly not without risk.
Japan’s equity market was a standout during the first quarter of 2012, as the MSCI Japan Local Currency Index was the top-performing MSCI Local Currency Country Index of the 22 represented in the MSCI EAFE Index.We believe that even after a strongly positive first quarter of 2012, gains among Japanese equities can potentially continue from these levels, given that the constituents within the MSCI Japan Index still seem to currently be priced low relative to their trailing 12-month dividends. As this entire piece will involve discussion of the performance and valuation of different equity market indexes, it is important to state that investors cannot invest directly in indexes.
Evidence That a Thoughtful Rules-Based Methodology Can Generate Significant Outperformance
THE INDICATED DIVIDEND STREAM OF U.S. EQUITIES REACHES NEW RECORD HIGHIndicated dividends of companies in the United States reached a new record high of $295.5 billion, as measured by the dividends on the WisdomTree Dividend Index on March 14, 2012. This figure is nearly 2.5% above the prior peak of $288.53 billion, observed at the November 30, 2007, index rebalance, and over 34% above the indicated dividend stream’s bottom on November 30, 2009.
Japan Currency in Focus as Bank of Japan Acts AgainThe Bank of Japan (BOJ) recently announced new monetary policy goals that established an inflation target of 1% in its battle to end deflation1 and stimulate economic growth. The BOJ has been facing an intractable battle to counteract the Japanese economy’s deflationary tendencies, which have contributed to a strengthening yen and a challenging operating market for Japan’s exporting powerhouses.
…and How Long Before They Are Eligible for Inclusion in Various Dividend-Focused Indexes?On February 23, Apple held its annual shareholder meeting. Prior to the gathering, there was widespread speculation that Apple would announce its first dividend payment since 1995.
2011 represented a difficult year for the performance of both India’s equities and its currency, the rupee. In light of these negative returns, reasoned economic analysis must separate the fundamental, long-term performance drivers from those that are potentially more transient and sentiment based.
After the 2008–09 financial crisis and the periods of subsequent market volatility—notably during the latter part of 2011— investors sought a variety of potential risk-mitigation strategies in an attempt to buttress their portfolios. Within equities, a focus on dividend-paying stocks has been a classic avenue for this type of approach. But where should one look for dividend paying stocks?
Fundamentals versus sentiment Asset class performance in 2011 has been largely driven by sudden, sweeping changes in investor sentiment. These behaviors have largely hidden the resilient fundamentals within emerging market economies, and investors have faced significant headwinds as emerging market currencies have largely weakened against the U.S. dollar.
This Rebalance commentary Discusses: Part 1: Key Features of the Aggregate Dividend Stream Growth in 2011 by Sector, Part 2: 20 Largest Dividend Payers in the United States, Part 3: S&P 500 Sector Performance [ as of November 30, 2011 ], Part 4: Ten Largest Dividend Initiators/Additions to the WisdomTree Dividend Index, Part 5: Analysis of Sector Changes in Select Indexes, Part 6: Performance Evaluation of the WisdomTree Dividend Indexes Since Inception and in 2011
After more than 20 years of malaise in Japanese equities and in the wake of the devastating earthquake in March that has crippled portions of the economy, we believe it may be worthwhile for investors to take a fresh look at potential opportunities in the third-largest economy in the world (behind the U.S. and China).
2011: A Year of Turmoil and Crisis - An onslaught of events contributed to increased volatility in the financial markets in 2011.
Many investors have become increasingly concerned about the potential for a low-growth global economy and the impact it may have on their investments.
Rebalance Introduction - Every year at the end of August, WisdomTree screens the investable equities of India for the rebalance of its India Earnings Index. This year the Indian equity markets have taken a drubbing.
As investors attempt to cope with uncertainties in the global economy and equity markets, it appears from our analysis of Exchange Traded Fund (ETF) asset flows that many are seeking refuge in dividend-paying U.S. stocks, which are often considered less volatile and more defensive in nature.
One of the most significant ongoing issues casting a dark shadow over the markets in 2011 has been the European debt crisis.
On the heels of the historic S&P downgrade of the U.S. Treasury credit rating, the Federal Reserve announced a new monetary policy target intended to keep its extremely low Federal Funds target rate near zero until the middle of 2013.
Few sectors are as deeply ingrained within almost every aspect of the economy as Financials, specifically banks. Some commentators believe that until the financial sector displays leadership in terms of stronger relative performance over the broader markets, there is little reason to own equities.
Countries can essentially be divided into two categories—those that have natural resource and commodity wealth, and those that must import natural resources. Countries that must import such commodities as oil (i.e., the United States, China and India) suffer during commodity price spikes, while exporters of commodities (i.e., Canada, Russia, Brazil) benefit.
Inflation erodes the purchasing power of money and can negatively influence portfolio returns. Lately, the loose monetary policy embraced by the Federal Reserve in the wake of the financial crisis of 2008 has created anxiety about the purchasing power of the U.S. dollar.
At WisdomTree, we screen for our global Index family annual rebalance on May 31. The global rebalance is designed to reanchor weights to the Dividend Stream of each company.
The fundamentals of the U.S. stock market, when measured by the U.S. indicated Dividend Stream,2 have been improving nicely since the market crisis in 2008 and early 2009.
On Monday, April 18, 2011, Standard & Poor’s placed a "negative" outlook on the United States’ AAA credit rating,1 citing the United States government’s failure to address growing short-term deficits, burgeoning entitlements and external borrowing.
Stories of corruption, food inflation and anxiety over a potential oil price shock weighed heavily on India's equity markets and resulted in India experiencing one of the greatest declines of emerging markets countries during the first quarter of 2011
Given the uncertainty surrounding how quickly Japan will be able to rebuild its economy and address the fallout of nuclear reactor issues, it would not have been surprising to see large outflows from the region.
The dramatic run of emerging markets in the recent past has led some to believe that the shunned developed markets could potentially outperform the emerging markets in 2011.
The global financial crisis of 2008 created significant levels of volatility—and opportunity.
Analysts who are the most bearish on the U.S. equity markets point to expensive valuation ratios on the S&P 500, notably the dividend yield, being considerably below its long-term average.
"The Lost Decade" is a phrase used to describe the ten-year period experienced from boom (12/29/1989) to bust in the Japanese equity market.
The recession of 2008 wreaked havoc on the economy and financial markets.
As of this writing, the Obama administration is in the final stages of negotiating a deal with Republicans to extend the 2003 Bush tax cuts for everyone in the United States.
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