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Axios
3 days ago
- Business
- Axios
GOP tax chief says Trump bill will keep foreign nations "in check"
House Ways and Means chair Rep. Jason Smith (R-Mo.) said a measure in President Trump's proposed tax bill that takes aim at foreign investors is a way to keep other nations "in check." Why it matters: Wall Street is worried that a tax on foreign investment contained in the "One Big Beautiful Bill" could make overseas investors reluctant to buy U.S. assets — at a time they are already wary of U.S. policies. What they're saying: "A big concern is that foreign governments, based on agreements entered into by the Biden administration, is trying to suck away billions of dollars from U.S. companies," Smith told Axios' Neil Irwin at the Reagan National Economic Forum. "This is a way to help put them in check, so that they understand that if they do that to our businesses, there will be consequences for their actions. Hopefully it'll never take an effect," Smith said. Catch up quick: The provision, called Section 899, proposes increasing tax rates for foreign direct investment from countries with unfair tax policies, as judged by the Trump administration. So, for example, an overseas sovereign wealth fund that owns U.S. stocks and bonds could face a tax on the earnings on their investment. The fear is that such a levy turns off foreign investors at a crucial moment: there are concerns that the safe-haven status of U.S. assets is in question, which would make it more difficult to borrow. What to watch: Asked whether Smith was concerned about this possibility, the top tax lawmaker said discriminatory tax regimes were a risk to U.S. corporations. "We're the first country in 2017 that created a global minimum tax. They don't even accept our global minimum tax. That's completely unfair," Smith said. "We're being punished for actually following what they're trying to do," Smith added. The other side: "The measure risks detonating investor confidence and could set off a damaging pullback of foreign capital just as the US needs it most," said Nigel Green, CEO of deVere Group, a financial advisory and asset management firm.
The National
24-05-2025
- Business
- The National
Stocks decline on Trump's tariff threats against Europe and Apple
Major stock indexes fell on Friday after US President Donald Trump issued his latest trade threats, recommending a tariff of 50 per cent on goods imported from the EU, starting June 1, and considering a 25 per cent tariff on any Apple iPhones made outside the US. The three major US stock indexes finished weaker. The Dow Jones Industrial Average fell 0.61 per cent, the S&P 500 dropped 0.67 per cent and the Nasdaq Composite slipped 1 per cent. For the week, the Dow lost 2.47 per cent, the S&P 500 fell 2.61 per cent and the Nasdaq shed 2.48 per cent. The dollar sank 1 per cent versus the Japanese yen, while the euro rose 0.8 per cent against the greenback. The dollar index, which measures the greenback against a basket of currencies, hit a three-week trough. For the week, the dollar was down 1.9 per cent. 'This isn't a strategic bluff – this is a destabilising threat that could do real, lasting damage,' said Nigel Green, chief executive of global financial advisory giant deVere Group. 'Markets are rightly alarmed. Beyond the short-term volatility, there's a bigger risk unfolding: the risk of recession and erosion of US credibility on the global stage.' Trump said in a post on his Truth Social network: 'The European Union, which was formed for the primary purpose of taking advantage of the United States on trade, has been very difficult to deal with.' Moody's downgraded the US credit rating late last Friday and the US House of Representatives narrowly approved Mr Trump's sweeping tax cuts on Thursday. The new tax-cut bill is expected to add almost $4 trillion to the US federal government's $36 trillion debt pile. The price of gold, a safe haven for investors, rose. Spot gold rose 2.14 per cent to $3,364.74 an ounce. Government bonds in the US climbed on safe-haven buying after sustaining heavy pressure this week from rising concerns about Mr Trump's tax cuts and the White House's ballooning debt pile. Yields move the opposite direction to prices. The 30-year US bond yield, which on Thursday hit the highest since October 2023, fell in response to fresh tariff fears. The yield was down 2.2 basis points at 5.042 per cent. The yield on benchmark US 10-year notes fell 3.6 basis points to 4.517 per cent. 'The clearest warning came from the bond market. This is capital seeking safety and that's a vote of no confidence in stability,' Mr Green said. Apple shares fell 3 per cent after Mr Trump said in a Truth Social post that he told company chief executive Tim Cook 'long ago' that 'I expect their iPhones that will be sold in the US will be manufactured and built in the US, not India, or anyplace else'. Apple is speeding up plans to make most iPhones sold in the US at factories in India by the end of 2026 to navigate potentially higher tariffs in China. The president's attack on Apple is his latest attempt to pressure a specific company to move production to the US, following car makers, pharmaceutical companies and chip makers. Moving production to the US would likely increase the cost of iPhones by hundreds of dollars. Later on Friday, Mr Trump told reporters inside the Oval Office that his proposed tariff on Apple would also apply to 'Samsung and anybody that makes that product', probably referring to smartphones. He said he expected the new phone levy to be in place by the end of June. The White House had paused most of the tariffs Mr Trump announced in early April against nearly every country. However, Mr Trump left in place a 10 per cent baseline tax on most imports and reduced the 145 per cent tax on Chinese goods to 30 per cent. 'This is bad economics and it's bad diplomacy,' the deVere chief executive said. 'You cannot keep threatening massive tariffs on allies and expect to maintain credibility. The world is watching and beginning to price in a future where US trade policy is impulsive and unreliable.' 'This kind of brinkmanship may win headlines, but over time, it weakens America's role as a trusted economic partner. You can't build lasting influence on erratic threats.' The US risks trading away long-term credibility for short-term posturing. The markets are reacting now. But the consequences could last much longer, he warned.
The Independent
22-05-2025
- Business
- The Independent
Why experts think bitcoin is at a ‘pivotal moment'
Bitcoin 's price surged to an all-time high of over $110,000, a nearly 50 per cent increase since April, surpassing its previous record. Favorable market conditions, including de-escalation of the US-China trade war, lower interest rates, and increased global liquidity, contributed to the rally. Nigel Green, CEO of global financial advisory firm deVere Group, said bitcoin is at a 'pivotal moment' due to political momentum and retail resurgence. Other cryptocurrencies like Ethereum, Solana, Dogecoin, and Cardano have also seen price increases. Crypto analysts are revising their 2025 price predictions, with some suggesting Bitcoin could reach $175,000 or higher.
Yahoo
16-05-2025
- Business
- Yahoo
Wall Street Is Preparing for a Bitcoin Boom — 3 Things Investors Should Do Now
Bitcoin is trading at nearly $104,000, over a 65% jump from just a year ago. Crypto supporters are calling 2025 the year for digital assets, and they're giving much of the credit to President Donald Trump's outspoken backing, according to Fortune. Check Out: Try This: Love it or hate it, crypto has reached the financial mainstream with a total market cap topping $3 trillion, reported Fortune. So, what does this mean for investors right now? Whether you're holding coins, watching from the sidelines or wondering if it's too late to jump in the game, here's what to consider as Wall Street braces for a potential crypto boom. While crypto is a new market compared to other investments, strategies continue to develop. The first step for investors is to do in-depth research — even more so when considering investing in digital assets. Always research the wallets, coins and exchanges. Don't rely on social media. And speak to a financial advisor to separate facts from fiction. Read Next: Liquidity simply means how quickly and easily you can turn an investment into cash. In the crypto world, the more well-known a coin is, the easier it is to buy or sell. Major players like bitcoin and ethereum tend to be more liquid than smaller altcoins, according to U.S. News. Still, because the crypto market is so volatile, it's less liquid than traditional investments. However, Nigel Green, CEO of deVere Group, told U.S. News that bitcoin ETFs could increase accessibility and liquidity, stabilizing prices and the market. All markets fluctuate, but crypto is more volatile than markets such as the S&P 500, which means it comes with higher risks. While it may be tempting to focus on the quintupling growth of bitcoin over the last two years, also know the risks. Crypto short-term returns can resemble the ups and downs of a roller coaster — full of quick rises and sudden drops. For example, bitcoin's price sank 22% in just seven days between late July and early August 2024. That doesn't necessarily mean you shouldn't invest; just don't panic-sell when the price drops. More From GOBankingRates Surprising Items People Are Stocking Up On Before Tariff Pains Hit: Is It Smart? 7 Things You'll Be Happy You Downsized in Retirement 5 Little-Known Ways to Make Summer Travel More Affordable How Far $750K Plus Social Security Goes in Retirement in Every US Region Sources Fortune, 'Bitcoin is on fire. If you're new to crypto, read our tips before you invest.' U.S. News & World Report, '7 Best Cryptocurrency Investing Strategies.' This article originally appeared on Wall Street Is Preparing for a Bitcoin Boom — 3 Things Investors Should Do Now 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
Yahoo
12-05-2025
- Business
- Yahoo
Dollar Surges After US and China Agree to Reduce Trade Tariffs
(Bloomberg) -- The dollar soared and government bonds sold off as markets reacted to a de-escalation in the trade war between China and the US, which agreed to temporarily lower some tariffs for 90 days. A New Central Park Amenity, Tailored to Its East Harlem Neighbors As Trump Reshapes Housing Policy, Renters Face Rollback of Rights Is Trump's Plan to Reopen the Notorious Alcatraz Prison Realistic? What's Behind the Rise in Serious Injuries on New York City's Streets? NYC Warns of 17% Drop in Foreign Tourists Due to Trump Policies A gauge of dollar strength rose as much as 1% and the yen, a traditional haven, plunged as progress in talks stoked appetite for risk assets. The US 10-year yield climbed seven basis points to 4.45%, its highest in nearly a month, while stocks got a boost on both sides of the Atlantic. It's a potential pivot point for markets, which have been roiled by US President Donald Trump's attempts to rewire global trade. He targeted China with particularly punitive tariffs, sparking a trade war and fears of a recession. 'This kind of coordinated tariff relief, even if temporary, changes the investment landscape,' said Nigel Green, chief executive officer of deVere Group. 'It clears a path for businesses to recalibrate their outlook, and for markets to rally on something more than just hope.' After weekend talks in Geneva, the US and China issued a joint statement indicating that they would temporarily lower tariffs on each other's products for 90 days. It buys the world's two largest economies three more months to resolve their differences. In the US, Nasdaq 100 futures surged as much as 3.9% while S&P 500 futures rose 3.1%. Europe's Stoxx 600 index climbed as much as 1.2% but gains were tempered by a drop in pharmaceutical stocks as Trump said he planned to order a cut in US prescription drug costs. Still, the move toward de-escalation of trade tariffs spurred some big sector-level moves in Europe, with shipping stocks including Danish container giant A.P. Moller-Maersk A/S surging 13% and Germany's Hapag-Lloyd AG up around 10%. Automakers Stellantis NV, Mercedes-Benz Group AG and BMW AG all rose over 5%. 'These are cuts in tariffs which are much deeper than what was expected,' said David Kruk, head of trading at La Financiere de L'Echiquier. 'For those who were bearish since the tariffs announcement, this is a real pain trade. There is no more dip to buy so if you were not invested, it's really hard to go in now.' Havens Slide The Swiss franc and euro also fell against the greenback following the announcement. The common currency, which had emerged as a haven amid the rout in US assets, fell as much as 1.5% to $1.1084, putting it on track for its worst day this year. 'This is positive for G-10 risk especially the Antipodean currencies and the US dollar,' said Valentin Marinov, head of G10 FX strategy at Credit Agricole SA. 'Easing US growth fears should further help restore market confidence in the USD-denominated assets.' Traders rushed to pare wagers on the extent of interest-rate cuts from major central banks this year, as concerns over the economic outlook ebbed. Swaps now favor a quarter-point reduction in September from the Federal Reserve, compared to as soon as July last week. The European Central Bank is expected to cut rates by around 50 basis points for the remainder of the year, versus more than 60 basis points at Friday's close. Still, the relief for US assets may prove temporary. Even before Monday's announcement, investors were warning that the US administration's aggressive trade policies exposed the risk of significant overweights to the region, meaning outflows would likely endure even if trade tensions dissipated. 'We believe concerns around the US hard-data outlook persist, and potential asset allocation shifts away from US assets remain medium- to longer-term headwinds for the greenback,' said Mohamad Al-Saraf, an analyst at Danske Bank. --With assistance from Kit Rees, Julien Ponthus and Vassilis Karamanis. (Updates prices throughout.) US Border Towns Are Being Ravaged by Canada's Furious Boycott How the Lizard King Built a Reptile Empire Selling $50,000 Geckos With the New York Liberty, Clara Wu Tsai Aims for the First $1 Billion Women's Sports Franchise Maybe AI Slop Is Killing the Internet, After All Pre-Tariff Car Buying Frenzy Leaves Americans With a Big Debt Problem ©2025 Bloomberg L.P. 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
