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Illustration: Sarah Grillo/Axios

The Business Roundtable on Wednesday announced that CEO confidence fell to the lowest level in 3 years — a doom-and-gloom indicator that contrasts the high levels of consumer optimism.

Why it matters: Top executives are feeling the pain from the trade war, prompting them to hold off on spending decisions that propel economic growth. Consumers, so far unshaken by tariffs and similar threats, could be the economy's saving grace.

Driving the news: The Business Roundtable's closely watched index of CEO confidence declined sharply from the prior quarter's reading, reflecting the biggest quarter-over-quarter decline since 2012. The lobbying group said increased geopolitical tensions, and specifically the trade war, were to blame.

  • J.P. Morgan CEO Jamie Dimon: "You look at the business community — they are looking right now at Iran, North Korea, India, Pakistan, Hong Kong, China and trade. All these [are] things that you have to incorporate into thinking about how you manage your global risks."
  • Beth Ford, CEO of Land O' Lakes, said the lack of clarity around the fate of the trade agreement among the U.S., Canada and Mexico is causing uncertainty for business owners her company knows well: farmers.

But consumers aren't focused on these problems and haven't pulled back on spending. Indeed, consumers are expected to deliver a blockbuster holiday shopping season, even stronger than last year.

  • "It's not that the consumer doesn't know [about these risks] ... they have jobs, their wages are going up — that's pretty good for them," Dimon said.
  • Delta CEO Ed Bastian told Fox Business on Wednesday that "gangbusters" consumer spending will benefit the airline by way of strong travel demand this holiday season.

Between the lines: The Federal Reserve also pointed out the divergence in how businesses and consumers are responding to heightened uncertainty.

  • "Household spending, supported by a strong job market and rising income and solid consumer confidence, has been the key driver of growth," Fed chair Jerome Powell told reporters on Wednesday.
  • Meantime, Powell said, businesses around the country told the Fed that "uncertainty about trade policy has discouraged them from investing in their businesses."

The bottom line: The Fed's willingness to step in and trim borrowing costs amid these increased risks — as it did for the 2nd consecutive time on Wednesday — may comfort the CEOs who have been climbing a wall of worry.

  • While the rate cut is great for many consumers (borrowers, not savers), it may not fend off the pain businesses are feeling from the trade war.
  • "I don't think cutting rates will offset trade, personally," Dimon said.

Editor's note: This piece was corrected to show the company's name is Land O'Lakes.

Go deeper

Updated 28 mins ago - Politics & Policy

Omicron dashboard

Illustration: Shoshana Gordon/Axios

  1. Health: Concerns grow over CDC's isolation guidelines — Experts warn of more COVID-19 variants after Omicron.
  2. Vaccines: America's vaccination drive runs out of gas — Puerto Rico expands booster shot requirements.
  3. Politics: Joint Chiefs chair Gen. Mark Milley tests positive for COVID-19 — Vivek Murthy calls SCOTUS vaccine mandate block "a setback for public health."
  4. Economy: Report: World's 10 richest men doubled wealth during pandemicAmerica's labor shortage is bigger than the pandemic.
  5. States: America struggles to keep schools open — Youngkin ends mandates for masks in schools and COVID vaccinations for state workers.
  6. World: Greece imposes vaccine mandate for people 60 and older — French parliament passes COVID vaccine passport legislation.
  7. Variant tracker

Joint Chiefs chair Gen. Mark Milley tests positive for COVID-19

Photo: Olivier Douliery - Pool/Getty Images

Mark Milley, chairman of the Joint Chiefs of Staff, tested positive for COVID-19 on Sunday.

State of play: Joint Staff spokesperson Col. Dave Butler said in a statement that Milley — who is fully vaccinated and has received a booster shot — is experiencing "very minor symptoms" and is "working remotely and isolating himself."

Momentum builds to ban lawmakers from trading stocks

Illustration: Sarah Grillo/Axios

Some progressive Democrats and MAGA Republicans are uniting on a proposal to ban sitting lawmakers from trading individual stocks, although it's unlikely that leadership will bring the bill up for a vote.

Why it matters: Members of Congress have great power to move stock prices, and great financial incentives to do so.