These developments make a 40-year old series of events suddenly very interesting.

In mid-1973, Watergate independent special prosecutor Archibald Cox issued a subpoena to President Richard Nixon asking for copies of taped conversations recorded in the Oval Office. The President refused to comply and later ordered Attorney General Elliot Richardson and Deputy Attorney General William Ruckelshaus to fire Cox. Both refused and resigned. Solicitor General Robert Bork considered resigning but carried out the order. This series of events, known as the Saturday Night Massacre, sped up Nixon’s political demise.

For Trump, firing Mueller is equally inconvenient. Republicans hold both the Senate and the House, making impeachment proceedings seemingly unlikely, so it is notable that Republican Senator Lindsey Graham, House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell all warned the President to leave Mueller alone, with Graham ominously stating “it would be the end of President Trump’s presidency.”

While the tweets attacking Mueller stopped in March, the Michael Cohen raid is once again raising speculation that Trump may fire Mueller.

For investors, the question is what impact Washington’s high drama could have on the stock market. A cursory glance at history raises red flags: in the 10-month period from the start of Nixon impeachment proceedings to his resignation, the S&P 500 dropped a stunning 43.5%.

In August 2015, oil prices were cratering and companies were in the middle a protracted earnings recession. It didn’t seem like the fall in corporate earnings was going to reverse any time soon and no one knew if the Federal Reserve was about to start pumping the brakes on the economy. The fall in stock prices felt justified.

Stocks are up 33% since.

The U.S. economy is running at its full potential for the first time in a decade https://t.co/7xXn3INg7G pic.twitter.com/awc6UrdgWO

— Real Time Economics (@WSJecon) December 5, 2017

Economists measure the economic health of a country through a measure of economic growth called GDP. In advanced economies like the U.S. where the total level of GDP per capita is already high, potential GDP growth is limited compared to developing countries where productivity gains through better technology and infrastructure are still being implemented.  The CBO estimates potential GDP, revising estimates as new information about the labor force and productivity become available. Long-term, this growth rate is estimated at 1.8%.

The winners of the InvestmentNews Best Practices Awards were identified through their participation in the 2017 Adviser Compensation & Staffing and the 2017 Adviser Technology Study. The winning firms were officially recognized today at InvestmentNews’ Best Practices Award and Workshop, which was hosted at The Colonnade Hotel in Boston.

"The Best Practices winners are some of the most strategic and successful firms in the advice business," said Mark Bruno, associate publisher at InvestmentNews and head of InvestmentNews Research. "Their leaders have a clear plan and vision for growing their firms and managing elite organizations. Acknowledging their accomplishments and telling their stories will help educate, inform and influence the growth of the overall industry.”

To identify the 2017 Best Practices Award winners, InvestmentNews Research created composite scores that examined several key metrics from its core benchmarking studies – including a firm’s rate of growth, profitability and productivity level. The data was obtained from over 700 independent advisory firms that participated in the 2017 Adviser Compensation & Staffing Study and the 2017 Adviser Technology Study. The “Best Practices” were those who ranked among the top-quartile of all participants; in addition, the final firms were selected after qualitative interviews conducted by the InvestmentNews Best Practices Committee.

Still, it is good to understand what this bill is and isn’t and how it might affect you and your investments.

Below are quick links to help:

• The details of the plan and its full text (Business Insider)
• Six Charts That Help Explain the Republican Tax Plan (New York Times)
• A breakdown and possible road blocks the bill will have to overcome (Forbes)
• Changes proposed by the bill and opinions from a tax expert on these changes (The Reformed Broker)
• Does this Tax Reform Bill have a better chance than the GOP’s Healthcare Bills? (CNBC)

Long-term clients have surely seen or heard this phrase from us in a blog post or in a quarterly letter or in a meeting. It is a favorite saying of ours because it is simple advice that leads to very real value for any investor, whether a client or not.

Source: Carl Richards, The Best Investment Strategy? Getting Out of Our Own Way

Interestingly, this is a 180-degree change from 2016 when Large Growth stocks were the worst performers and Small Value stocks the best, highlighting the dangers in short-term performance chasing.

Small Value stocks were the best performers last year but are the worst performers this year