May 25, 2018

Corporate secret: Most businesses privately love the Trump era

Photo: Win McNamee/Getty Images

On balance, the people who run U.S. companies like the Age of Trump, The Economist writes in its cover story.

The big picture: "Bosses reckon that the value of tax cuts, deregulation and potential trade concessions from China outweighs the hazy costs of weaker institutions and trade wars."

  • "Bosses reckon that the value of tax cuts, deregulation and potential trade concessions from China outweighs the hazy costs of weaker institutions and trade wars."
  • The key point: "The financial fireworks on display in the first quarter of this year suggest that this vision is coming true. The earnings of [public companies] rose by 22% compared with a year earlier; investment was up by 19%."
  • "But ... the investment surge is unlike any before — it is skewed towards tech giants, not firms with factories."
  • Why it matters: "Republicans are right that tax cuts and wise deregulation can boost firms’ competitiveness. But little progress is being made on other priorities, including repairing infrastructure, ensuring small firms are not squashed by monopolies and reforming the education system."
  • The takeaway: "A strategy that assumes revenues but not expenses rarely makes sense."

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There are warning signs that Nevada could be Iowa all over again

Former Sen. Harry Reid (D) lines up to cast an early vote for the upcoming Nevada Democratic presidential caucus. Photo: Ethan Miller/Getty Images

The alarms are increasingly sounding over Nevada's Democratic caucus, which is just five days away.

Why it matters: Similar issues to the ones that plagued Iowa's caucus seem to be rearing their ugly heads, the WashPost reports.

China tries to contain coronavirus, as Apple warns of earnings impact

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's NHC; Note: China refers to mainland China and the Diamond Princess is the cruise ship offshore Yokohama, Japan. Map: Danielle Alberti/Axios

As China pushes to contain the spread of the novel coronavirus — placing around 780 million people under travel restrictions, per CNN — the economic repercussions continue to be felt globally as companies like Apple warn of the impact from the lack of manufacturing and consumer demand in China.

The big picture: COVID-19 has now killed at least 1,775 people and infected more than 70,000 others, mostly in mainland China. There are some signs that new cases are growing at a slower rate now, although the World Health Organization said Monday it's "too early to tell" if this will continue.

Go deeperArrowUpdated 4 hours ago - Health

Apple will miss quarterly earnings estimates due to coronavirus

Apple CEO Tim Cook

Apple issued a rare earnings warning on Monday, saying it would not meet quarterly revenue expectations due to the impact of the coronavirus, which will limit iPhone production and limit product demand in China.

Why it matters: Lots of companies rely on China for production, but unlike most U.S. tech companies, Apple also gets a significant chunk of its revenue from sales in China.