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EU-US trade deal will come with economic consequences, German industries warn
While European Commission President Ursula von der Leyen praised a trade agreement signed between the EU and US on Sunday as a stabilising factor "in uncertain times," representatives of the German economy have expressed concern. Von der Leyen and US President Donald Trump struck a tentative trade deal to avert a potentially devastating tariff war between two of the world's largest economies on Sunday. The majority of EU exports bound for the US will be subject to a 15% tariff. According to a statement made by von der Leyen, this also includes billions of euros in EU investments in the US, as well as the purchase of defence equipment. Tariffs of 15% will now apply to car exports to the US, compared to the previously announced 25%. Import duties on steel are to remain unchanged at 50%. The German economy can breathe a sigh of relief for the time being, according to Managing Director of the German Chamber of Industry and Commerce Helena Melnikov. Melnikov said that worse has been prevented, however, "the deal has its price, and this price is also at the expense of the German and European economies." Wolfgang Niedermark from the Federation of German Industries was more critical. He stated that even a tariff rate of 15% would have an "immense negative impact" on Germany's export-oriented industry. The Federal Association of Wholesale, Foreign Trade and Service also spoke of a "painful compromise" and warned that supply chains would change and prices would rise, saying the deal will cost Germany growth, prosperity and jobs. Federal Chancellor Friedrich Merz, who was satisfied with Sunday's agreement, wrote on X that the deal showed it was possible to "avert a trade conflict". However, a review of Trump's actions to date raises doubts about the reliability of the agreement and the US president's words. In an interview with the Funke media group, Michael Hüther, director of the Institute for the German Economy, said that concerns remained as Trump had never completely taken tariff threats off the table. Sign in to access your portfolio
Yahoo
21 minutes ago
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Cleveland-Cliffs (CLF) Surges 20.7% as Firm Looks to Cash in Billions From Idle Assets
We recently published . Cleveland-Cliffs Inc. (NYSE:CLF) is one of the biggest performers recently. Cleveland-Cliffs jumped by 20.67 percent week-on-week to end Friday's trading at $11.44 versus the $9.48 on July 18, as investors took heart from news that it was mulling over the sale of its idle assets for as much as billions of dollars. According to a report by Manufacturing Drive, Cleveland-Cliffs Inc. (NYSE:CLF) is in talks with its investment adviser JPMorgan for the sale of its mills and other assets to potential buyers, including data center developers, as part of its effort to lower its overall debt and rightsize operations. 'These sites…are all uniquely positioned geographically and have what data center developers are looking for—access to power and water with the infrastructure already in place,' Cleveland-Cliffs Inc. (NYSE:CLF) CFO Celso Goncalves Jr. was quoted as saying. In the second quarter of the year, Cleveland-Cliffs Inc. (NYSE:CLF) swung to a net loss attributable to shareholders of $483 million from a $9 million attributable net income in the same period last year. This put its six-month net loss at $978 million, higher by 1,404 percent from the $65 million in the same period last year. Copyright: zenstock / 123RF Stock Photo Revenues for the quarter stood at $4.934 billion, lower by 3.1 percent than the $5.092 billion year-on-year. Revenues for the first semester of the year, however, declined by 7 percent to $9.563 billion from $10.291 billion year-on-year. While we acknowledge the potential of CLF as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Who Benefits From Tax Changes in Trump's ‘Big Beautiful Bill'?
President Donald Trump signed the One Big Beautiful Bill Act into law, marking the largest tax package in recent American history. The legislation promises sweeping changes across the tax landscape, extending previous cuts while introducing new provisions that affect millions of Americans. However, analyzing the distribution of these benefits reveals a complex picture of who truly gains from these changes — we'll explore this below. For You: Read Next: The Big Winners: High-Income Earners Lead the Pack The One Big Beautiful Bill is projected to reduce federal revenues by about $5 trillion between 2025 and 2034, according to the Tax Foundation. Analysis by ITEP shows that 69% of net tax cuts in 2026 will go to the top 20% of earners and the wealthiest 1% receive an average annual tax cut of $61,000, vastly exceeding benefits for other groups. 'The tax benefits primarily go to the 'rich,' and much of the cuts will negatively impact the 'poor,'' said Jay Zigmont, Ph.D., certified financial planner (CFP) and founder of Childfree Trust. The legislation is also expected to increase the national debt by $3.3 trillion to $4 trillion over ten years. Higher-income households benefit from the temporary SALT deduction increase, with significant relief for those in high-tax states. See More: Estate Tax Changes Favor Ultra-Wealthy Families The legislation permanently raises the estate and gift tax exemption to $15 million per individual or $30 million for married couples, per Tax Foundation analysis. This represents a dramatic increase from previous levels and removes uncertainty around potential reductions. 'The increase in the estate tax exemption to $15 million is a great example of a benefit solely for those with very high net worths,' explained Zigmont. This change primarily affects families with substantial wealth, as most American households fall well below these exemption thresholds. The permanence of this provision ensures wealthy families can engage in long-term estate planning without concerns about future reductions. Middle-Class Benefits Come With Important Limitations The legislation includes several provisions targeting middle-income Americans, though their impact varies significantly by household circumstances. A new $6,000 senior bonus deduction benefits taxpayers aged 65 and older, but phases out for higher earners. According to AARP analysis, the deduction reduces to zero for single filers earning above $175,000 annually. The bill creates tax exemptions for tips and overtime pay, addressing campaign promises from the 2024 election. CNBC reported that workers can deduct up to $25,000 in tip income and $12,500 in overtime pay annually, with both benefits phasing out for higher earners. However, Zigmont shared important limitations: 'The deductions for tips and overtime are limited' and 'both are temporary cuts' lasting only through 2028. New Programs Target Future Generations Trump Accounts represent a novel approach to childhood savings, providing $1,000 government contributions for babies born between 2025 and 2028. According to White House statements, these accounts will be a benefit to children by way of compounded savings. Parents can contribute up to $5,000 annually, with funds growing tax-deferred until age 18. Zigmont shared potential market effects of these. 'The plan is for the government to provide $1,000 for each child when they are born into an account that needs to be invested in a broad market index,' he said. With approximately 3.6 million births annually, this creates substantial ongoing market investment. Significant Cuts Impact Vulnerable Populations The legislation introduces about $1 trillion in Medicaid cuts over ten years, threatening coverage for up to 11.8 million Americans, per the Congressional Budget Office. 'People who rely on Medicaid and SNAP programs are most at risk,' Zigmont said — with $230 billion in SNAP reductions affecting 22.3 million families, Urban Institute reports. 'Women's health in rural areas is likely to be hurt,' Zigmont said, as Medicaid cuts and Planned Parenthood defunding further limit access to essential healthcare in underserved communities, shifting more costs onto states and disproportionately hurting those already struggling. Long-Term Fiscal Consequences Raise Concerns The OBBBA is projected to add between $3.3 trillion and $4 trillion to the national debt over the next decade, according to Zigmont. The Tax Foundation estimates this will push the U.S. debt-to-GDP ratio up by 9.6 percentage points to 126.7% by 2034. This rising debt could force future tax hikes or spending cuts, limiting government flexibility and straining the economy. While the bill delivers substantial, lasting benefits to high-income households, middle-class gains are smaller and temporary. 'At some point that debt is going to be due and we have no solution at this point,' Zigmont added. Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates Mark Cuban Says Trump's Executive Order To Lower Medication Costs Has a 'Real Shot' -- Here's Why This article originally appeared on Who Benefits From Tax Changes in Trump's 'Big Beautiful Bill'? Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
