Assignment:
This memo addresses the potential impact of Donald Trump's presidency for our company, which has imaginary business with The Trump Organization.
Our clients have raised concerns regarding their investments if President Trump or his company are subject to investigations or conjecture.
Further, our clients have expressed concerns about opportunities and risks of investment in Russia.
Summary
• Munoz Financial Services has a $10 million direct investment in an imaginary Trump-affiliated golf course project.
• The Trump Organization LLC is engaged in global real estate development and global licensing, sales and marketing, property management, golf course development, entertainment, entertainment and product licensing, brand development, restaurants and event planning businesses. Our portfolio includes investments in some of these projects.
• Trump has promised $11 trillion in tax cuts, which would likely lead to a bigger deficit and interest rate hikes from the Federal Reserve.
• It is an open question how a Trump rapprochement with Russia would affect bilateral trade.
Discussion: What does it all mean for reader?
Non-Existent Financial Services has significant exposure to economic and political effects of the Trump presidency and to the Trump Organization. Our company has outperformed market indexes since 2008. We have had no requests from clients to sell positions. There is no consensus view among neutral analysts at this time whether Trump investments will continue to do well, but press reports warn of pending investigations related to the Trump Organization prior to the 2016 election.
Closing and Actions
Uncertainty regarding future performance of Trump Organization interests suggests caution for the first six months of 2017. I recommend: Next steps and call to action
• Our company keep current positions in Trump-associated projects.
• Write a memo to our investment clients recommending they reduce their investment positions in Trump-associated projects until we can provide more confidence guidance.
ASSIGNMENT: LET'S WRITE ONE
Please draft a memo summarizing the Federal Reserve Report: Report on the Economic Well-Being of U.S. Households in 2017
• The Executive Summary and Conclusions.
• The entire report is available as PDF at: www.federalreserve.gov/publications/2017-economic-well-being-of-us-households-in-2016- executive-summary.htm
• Please retrieve the complete report, print and retain for your reference.
Please write a single-page memorandum in the style and format reviewed in class.
• 11-point Calibri font, single line spacing, normal word template.
• For the exercise, assume that you are the Chief Economist for the National Bank of Pomona. Address the memo to the CEO of the bank.
• Your purpose is to advise the CEO on the contents and meaning of the federal report so that the bank is informed about the economic status of families.
• Summarize three key points that you believe might be important to the bank in pursuing an opportunity in the next 12 months.
• Briefly discuss what the meaning of the report, in clear terms.
• Make one specific recommendations for action.