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Business Times
an hour ago
- Business
- Business Times
Obscure tax item in Trump's Bill alarms Wall Street
BURIED deep in the more than 1,000-page tax-and-spending bill that President Donald Trump is muscling through Congress is an obscure tax measure that's setting off alarms on Wall Street and beyond. The item – introduced in legislation that passed the House last week as Section 899 and titled 'Enforcement of Remedies Against Unfair Foreign Taxes' – calls for, among other things, increasing tax rates for individuals and companies from countries whose tax policies the US deems 'discriminatory.' This includes raising tax rates on passive income, such as interest and dividends, earned by investors who are potentially sitting on trillions in American assets. Cloaked in technicalities, the implication of the 'revenge' measure, as it's quickly becoming known, is clear to analysts: If signed into law, it would further drive away foreign investors at a time when their once ironclad confidence in Treasury bonds and other US assets has already been shaken by Trump's erratic trade policies and the nation's deteriorating fiscal accounts. 'We're already dealing with a market where Treasuries, to foreign investors, probably aren't the most attractive investment,' said Michael Brown, a strategist at Pepperstone Group, a brokerage firm founded in Melbourne whose clients are all outside the US. Brown said he got so many inquiries from concerned clients that he quickly put together a report breaking down the measure. 'If you're now talking about massively unfavorable tax treatment, then it's just another reason to stay away.' Among those potentially affected: institutional investors including sovereign wealth funds, pension funds and even government entities, as well as retail investors and businesses with US assets. The proposed tax is separate from Trump's tariff-heavy trade agenda, which is now snarled in court, but the thrust is the same, and its aims align with some of the positions set forth by the economist Stephen Miran in a paper last November and those seeking a so-called Mar-a-Lago global restructuring accord. All seek to address perceived unfair treatment of the US by the rest of the world using targeted tools designed to put the country on a more even footing. But after years of foreign investors piling into US assets, experts fear the consequences of Section 899 may be far-reaching. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The provision amounts to 'weaponization of US capital markets into law' that 'challenges the open nature of US capital markets by explicitly using taxation on foreign holdings of US assets as leverage to further US economic goals,' George Saravelos, head of FX research at Deutsche Bank AG, wrote in a report on Thursday. 'We see this legislation as creating the scope for the US administration to transform a trade war into a capital war if it so wishes, a development that is highly relevant in the context of today's court decision constraining President Trump on trade policy.' Section 899 takes aim at countries including Canada, the UK, France and Australia that impose 'digital services taxes' on large technology companies such as Meta Platforms Inc. The clause also targets countries using provisions in a multi-country deal for minimum corporate taxes. The measure would boost the federal income tax rate on passive US income earned by investors and institutions based in the targeted countries, first by five percentage points, then rising by another five points each year to a maximum of 20 points above the statutory rate. 'Troubling' for bonds, dollar Morgan Stanley's strategists included the provision in frequently asked questions related to the tax-and-spending bill and concluded that Section 899 would weaken the dollar and European stocks with US exposure. Gilles Moec, the chief economist at AXA Group, said it could add to the pressure on long-term interest rates, which this month touched multi-year highs. Others see it dragging on the US currency. 'It's indeed sounds troubling,' said Rogier Quaedvlieg, senior US economist at ABN Amro Bank NV. 'By limiting new foreign demand, that would of course put pressure on the dollar.'' The risks related to the section 899 provision are seen by some as even more pressing after the US court order on Wednesday that blocked many of Trump's tariffs on imports. Tariffs are considered a key source of revenue to fund Trump's tax cuts, a signature part of his 'big, beautiful bill.' Without them, the question is where the administration will find the money to fund them. The intent of the measure appears similar in spirit to some ideas put forth in November by Miran while he was still working at hedge fund Hudson Bay Capital. Miran, now chairman of the White House Council of Economic Advisers, raised the possibility of imposing 'user fees' on foreign investors in Treasuries as one option to help push down the dollar and address global trade imbalances. 'The clause is clearly endorsed by the administration and designed to give Trump a negotiation tool for pressuring countries to drop digital services taxes and global minimum corporate income taxes, which he sees as unfairly targeting US multinational companies,' wrote Economist Will Denyer and Tan Kai Xian at Gavekal Research. 'The problem is that before Trump has a chance to use the new tool, its very existence may unsettle bond markets.' What strategists say 'With tariff revenue more uncertain and less likely to offset tax cuts in the GOP budget bill, traders need to be prepared for tax changes on foreign holders, ultimately reducing demand for American financial assets.' – Michael Ball, Markets Live macro strategist For now, the market reaction to Section 899 appears muted, at best. Still, US assets as a whole have been underperformers this year as Trump's policies put a dent in the narrative of the 'America exceptionalism.' The S&P 500 is up about 0.4% this year, compared with a 20% gain in the German benchmark and a 18% rally in Hong Kong. The Bloomberg Dollar Index slumped about 7%. The US Treasuries returned 2%, trailing the 5% gain in the global government bonds in dollar terms, according to data compiled by Bloomberg. Under the surface Section 899 is likely to remain in the final version of the reconciliation package, which is now being reviewed in Senate, because it has broad Republican support, according to Signum Global Advisors. While some are skeptical if the Section 899 would survive on concern it would dampen foreign investment into the US, Signum Global Advisors predicts it will likely remain in the final version of the reconciliation package, in part because it has broad Republican support. 'We believe the president's viewpoint is that there is such immense foreign appetite to invest in the US that it is not at risk of being thrown off course,' according to Charles Myers, a former Wall Street executive who runs advisory firm Signum, and Lew Lukens, a partner at the firm. To Pepperstone's Brown, the reason markets haven't reacted yet is because investors hadn't fully grasped the significance of the clause. But they're starting to now. 'It's only as the dust has settled that people are thinking that maybe there are some things lurking under the surface of the bill we should pay a little bit more attention to,' said Brown. 'And I think this section 899, this is probably one of them.' BLOOMBERG
Yahoo
2 days ago
- General
- Yahoo
Trump nominates former podcast host with history of inflammatory comments for top ethics job
President Donald Trump has nominated Paul Ingrassia, a former podcast host with a long history of inflammatory remarks, to head the U.S. Office of Special Counsel. 'Paul is a highly respected attorney, writer, and Constitutional Scholar, who has done a tremendous job serving as my White House Liaison for Homeland Security,' Trump said in a post on his social media platform Truth Social announcing the nomination Thursday night. Ingrassia is a far-right former podcaster and commentator with a lengthy list of incendiary comments. He has called for Jan. 6 to be declared a national holiday to honor the 'peaceful protest against a great injustice affecting our electoral system' and dismissed the Oct. 7, 2023, Hamas attack on Israel as a 'psyop.' He has worked for and praised 'manosphere' influencer Andrew Tate, who's facing rape and human trafficking charges, calling him an 'extraordinary human being.' He has referred to Tate as 'a dissident of authoritarianism' — a title he has said applies as well to white nationalist Nick Fuentes, the rapper Ye and Trump. He has also called for Joe Biden and Kamala Harris to be jailed, and referred to former Vice President Mike Pence as an 'FBI asset.' Ingrassia graduated from Cornell Law in 2022, joined conservative think tank The Claremont Institute later that year, became a leader in the New York Young Republican Club, and then went on to be a frequent presence at Trump rallies and Mar-a-Lago in 2023 and 2024. He's currently working as the White House liaison to the Department of Homeland Security and was formerly the administration's liaison to the Justice Department, where he'd been seen walking the halls, touting the president's agenda and telling people he was acting as the 'eyes and ears' of the White House. His post at the Office of Special Counsel will require Senate confirmation. The OSC is an independent federal investigative and prosecuting agency, tasked with shielding federal employees from prohibited personnel practices, including retaliation for whistleblowing. The agency head is confirmed to a five-year term, but Trump fired then-OSC head Hampton Dellinger earlier this year. Dellinger, a Biden nominee who was confirmed to the post last year, fought his dismissal in court but eventually dropped the suit. Ingrassia thanked Trump for nominating him in a post on X. 'As Special Counsel, my team and I will make every effort to restore competence and integrity to the Executive Branch — with priority on eliminating waste, fraud, and abuse in the federal workforce and revitalize the Rule of Law and Fairness in Hatch Act enforcement,' he wrote. This article was originally published on
NBC News
2 days ago
- Politics
- NBC News
Trump nominates former podcast host with history of inflammatory comments for top ethics job
President Donald Trump has nominated Paul Ingrassia, a former podcast host with a long history of inflammatory remarks, to head the U.S. Office of Special Counsel. 'Paul is a highly respected attorney, writer, and Constitutional Scholar, who has done a tremendous job serving as my White House Liaison for Homeland Security,' Trump said in a post on his social media platform Truth Social announcing the nomination Thursday night. Ingrassia is a far-right former podcaster and commentator with a lengthy list of incendiary comments. He has called for Jan. 6 to be declared a national holiday to honor the 'peaceful protest against a great injustice affecting our electoral system' and dismissed the Oct. 7, 2023, Hamas attack on Israel as a ' psyop.' He has worked for and praised 'manosphere' influencer Andrew Tate, who's facing rape and human trafficking charges, calling him an 'extraordinary human being.' He has referred to Tate as 'a dissident of authoritarianism' — a title he has said applies as well to white nationalist Nick Fuentes, the rapper Ye and Trump. He has also called for Joe Biden and Kamala Harris to be jailed, and referred to former Vice President Mike Pence as an 'FBI asset.' Ingrassia graduated from Cornell Law in 2022, joined conservative think tank The Claremont Institute later that year, became a leader in the New York Young Republican Club, and then went on to be a frequent presence at Trump rallies and Mar-a-Lago in 2023 and 2024. He's currently working as the White House liaison to the Department of Homeland Security and was formerly the administration's liaison to the Justice Department, where he'd been seen walking the halls, touting the president's agenda and telling people he was acting as the 'eyes and ears' of the White House. His post at the Office of Special Counsel will require Senate confirmation. The OSC is an independent federal investigative and prosecuting agency, tasked with shielding federal employees from prohibited personnel practices, including retaliation for whistleblowing. The agency head is confirmed to a five-year term, but Trump fired then-OSC head Hampton Dellinger earlier this year. Dellinger, a Biden nominee who was confirmed to the post last year, fought his dismissal in court but eventually dropped the suit. Ingrassia thanked Trump for nominating him in a post on X. 'As Special Counsel, my team and I will make every effort to restore competence and integrity to the Executive Branch — with priority on eliminating waste, fraud, and abuse in the federal workforce and revitalize the Rule of Law and Fairness in Hatch Act enforcement,' he wrote.
Yahoo
2 days ago
- Business
- Yahoo
Eric Trump Reveals Advice From Michael Saylor: Mortgage Mar-A-Lago And Take $2 Billion To Invest In Bitcoin
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Eric Trump, the executive vice president of The Trump Organization, was all praise for Strategy Inc. (NASDAQ:MSTR) co-founder Michael Saylor on Wednesday, stating that Bitcoin (CRYPTO: BTC) is "fortunate" to have him. What Happened: Speaking at the Bitcoin 2025 conference in Las Vegas, Trump recalled how Saylor attempted to persuade him to invest in the apex cryptocurrency. "You need to mortgage Mar-a-Lago right now. You need to take $2 billion out of Mar-a-Lago and need to go long Bitcoin," Trump quoted Saylor as saying. Trending: — no wallets, just price speculation and free paper trading to practice different Trump mentioned how Saylor advises everyone to follow his Bitcoin playbook and how it's an 'incredible opportunity' to capitalize on. "I've never seen that in any other industry where you have the titan of the industry that's literally advocating for smart people to compete against them," he said about Saylor. Meanwhile, when asked for a prediction, Trump said Bitcoin would clear $170,000 in a It Matters: These remarks come a day after Trump Media & Technology Group (NASDAQ:DJT) announced it will use the proceeds of a $2.5 billion private offering to create a Bitcoin reserve, a playbook popularized by Saylor's firm Strategy. Donald Trump Jr., Eric's elder brother, said at the same conference earlier that they were "seriously long" on Bitcoin and committed to the leading cryptocurrency. The Trump family's investments in cryptocurrencies were steadily growing. They previously made strategic bets on Bitcoin mining along with ties to the decentralized finance platform World Liberty Financial. Read Next: New to crypto? Get up to $400 in rewards for successfully completing short educational courses and making your first qualifying trade on Coinbase. A must-have for all crypto enthusiasts: Sign up for the Gemini Credit Card today and earn rewards on Bitcoin Ether, or 60+ other tokens, with every purchase. Photo Courtesy: Maxim Elramsisy On Send To MSN: Send to MSN This article Eric Trump Reveals Advice From Michael Saylor: Mortgage Mar-A-Lago And Take $2 Billion To Invest In Bitcoin originally appeared on 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
News18
2 days ago
- Entertainment
- News18
Make America Tweak Again: This Trump Family Member Is Inspiring A Cosmetic Surgery Craze
Last Updated: Dr. Norman Rowe said he has seen a noticeable uptick in patients asking for facial features similar to Ivanka Trump. A growing number of plastic surgery patients in the United States are requesting cosmetic procedures inspired by Ivanka Trump's appearance, according to prominent surgeons in New York and Florida. Dr. Norman Rowe, a board-certified plastic surgeon operating in Manhattan, the Hamptons, and Palm Beach, said he has seen a noticeable uptick in patients asking for facial features similar to Ivanka Trump. 'We're seeing as many as 15 clients a day in Palm Beach wanting the 'Ivanka look,'" he told the New York Post, referring to high cheekbones, full lips, wide eyes, and smooth, wrinkle-free foreheads- a combination some now refer to as the 'Mar-a-Lago Face." The demand isn't limited to younger patients as Norman noted that older clients often reference Kristi Noem, the South Dakota Governor and US Secretary of Homeland Security, as their aesthetic benchmark, praising her polished public appearance. While certain features can be replicated, Norman Rowe cautioned that results depend on a patient's existing facial structure. advetisement 'If someone says, 'I want her lips or nose,' we can work with that," he said, adding, 'But there are physical limitations. You can't completely transform someone's face if the base isn't there." Dr. Mark Epstein, a dual board-certified surgeon in New York City, reported a similar post-pandemic trend, particularly after the 2024 assassination attempt on Donald Trump. 'There was a noticeable increase in business and confidence," Mark Epstein said, linking the aesthetic trend to the growing visibility of Donald Trump-aligned public figures. Surgeons say the phenomenon reflects a cultural shift in aspirational beauty within certain political and social circles. Norman Rowe said, 'You go to Palm Beach or the Everglades Club, and you see it — a group of people who want to look polished, youthful, and visibly aligned with a certain lifestyle." Watch India Pakistan Breaking News on CNN-News18. Get breaking news, in-depth analysis, and expert perspectives on everything from geopolitics to diplomacy and global trends. Stay informed with the latest world news only on News18. Download the News18 App to stay updated! First Published:
