Politics

White House’s cold shoulder slows economic agenda

8 Mar 2017

GE executive David Nason has withdrawn from the running to head bank supervision at the Fed. Trump officials declined to offer support after critics noted his Treasury bailout role during the 2008 crisis. Other qualified people may also think twice about joining the new regime.

Do-nothing UK budget belies big risks ahead

8 Mar 2017

Finance Minister Philip Hammond revealed minimal changes to tax and spending. His prudent message makes sense, but contrasts with the large and unpredictable economic consequences of leaving the European Union. It won’t take much for these to knock deficit reduction off course.

Obamacare repeal to test Trump negotiating chops

8 Mar 2017

The new GOP healthcare plan has been condemned by party conservatives and moderates as well as industry groups. The president is embarking on a charm offensive to woo doubters. His performance will have implications for other policy pushes, like tax reform and a fiscal stimulus.

Britain needn’t fear SoftBank’s pass-the-parcel

8 Mar 2017

The Japanese tech group may shift part of its stake in British chip designer ARM to a $100 bln fund forged with Saudi Arabia. If SoftBank and ARM's board retain control, commitments over UK jobs should be upheld. A more international shareholder base may extend ARM's clout.

Britain’s Brexit bill is reassuringly expensive

8 Mar 2017

Lawmakers think the UK can legally dodge an EU exit liability of potentially 60 bln euros. The trouble is, refusing to pay makes it unlikely Britain can get a favourable deal. Moreover, such squabbling undermines Brexit supporters’ case that leaving the EU has a net benefit.

U.S. tech sanctions will rattle China’s firewall

8 Mar 2017

ZTE will plead guilty for violating U.S. trade curbs. The charges could have been more severe and an $892 mln fine is manageable. More powerful is the message it sends that the U.S. is prepared to take action against Chinese companies to rein in the likes of Iran and North Korea.

New U.S. healthcare plan is in critical condition

7 Mar 2017

After deriding Obamacare for years, Republicans have rolled out an alternative afflicted with financial and political problems. It would worsen insurance-exchange woes, raise costs for many Americans and weaken Medicare. The prognosis from Washington and Wall Street is dire.

China has leeway to tackle local debt mountain

7 Mar 2017

Authorities say cutting the $2.2 trln local government debt pile is a 2017 priority. Past attempts failed. An improving economy gives Beijing room to address the issue, in part by boosting local tax power. Possible higher interest rates and lower land prices argue for haste.

Nationality of Vauxhall’s owner is a red herring

6 Mar 2017

The sale of GM’s European operations to French carmaker PSA Group has caused fresh concern over its plants in the UK. Yet irrespective of the owner, the key risk for automotive jobs in Britain is Brexit. A stronger Peugeot may even have more patience with Vauxhall than GM.

Macron pitches novel way to imperil EU banks

6 Mar 2017

The French presidential favourite wants ministers, not regulators, to set capital rules for banks and insurers. Despite the ECB’s best efforts, oversight remains far from harmonised. Handing the reins to politicians would just add financial stability concerns to the mix.

Northern Ireland vote sends Brexit warning shot

4 Mar 2017

Nationalist party Sinn Fein made surprise gains in snap elections, buoyed by discontent with the ruling unionist DUP. That puts the duo, who must govern together, on a more equal but confrontational footing. The result may be a bumpier path for Britain’s EU exit negotiations.

Saudi Arabia’s Asian pivot looks defensive

3 Mar 2017

A rare royal visit to the region shows the oil-rich kingdom’s vulnerability. Declining U.S. demand and competition from Iran and Iraq make Eastern customers more important. Saudi can offer something rivals can’t - splashy investments and the IPO of its state oil producer, Aramco.

Drugmakers pose Brexit Britain withdrawal risk

3 Mar 2017

Pharma groups aren’t publicly threatening to pull staff out of the UK. But they could. Britain is a laggard in healthcare investment, and Brexit gives them negotiating power - especially after Prime Minister Theresa May’s gushing endorsement of the industry.

Seoul-Beijing feud cues Lotte to end China misery

3 Mar 2017

The South Korean retailer is under attack from Beijing for letting Seoul use its land for a defence system. Chinese state media is vowing to make life hard for the group. It's hard already. Losses in China have sparked a founding family spat. This rift is a good excuse to exit.

White House circles America’s welcome wagons

2 Mar 2017

Donald Trump has become the world’s antagonizer-in-chief, questioning the One China policy and imposing travel bans. Interest in visiting the United States, where foreign tourists spend $250 bln a year, has plunged since he took office. A damaged image will hurt the economy.

Viewsroom: SoftBank deal frenzy lacks hard logic

2 Mar 2017

The giant Japanese tech firm has been on a global M&A tear, but shareholders aren’t buying it. President Trump's mix of details-free policy pledges and jingoistic militarism looks dazed, confused and dangerous. Plus: Silvio Berlusconi's AC Milan sale puts Chinese buyers offside.

Schulz woos German voters with wrong reforms

2 Mar 2017

Angela Merkel’s Social Democratic challenger wants to roll back some of the labour market reforms pushed through 15 years ago by his own party. This plays well with voters but may harm Germany’s growth prospects. Abandoning excessive fiscal rigour would be the better U-turn.

Northern Ireland may bolster case for own spinoff

2 Mar 2017

If Thursday’s elections produce a stalemate, London may have to rule the thorny region directly. The 9 bln pound cost per year of propping up the region is likely to grow after Brexit, but a united Ireland is problematic too. The north is a prize no one wants.

France’s Macron faces peril of becoming mainstream

1 Mar 2017

Former front-runner Francois Fillon is persisting with a presidential bid despite new legal woes. That should help Emmanuel Macron. But the centrist is rapidly losing the useful cachet of being an outsider in what’s becoming a straight contest with far-right leader Marine Le Pen.

Trump sends investors more conflicting signals

28 Feb 2017

Speaking to Congress, the president repeated his criticism of foreigners after telling journalists earlier he’s open to legal status for illegal immigrants. There also were scant details on tax and healthcare reforms. A still-hazy message bodes poorly for the economic agenda.