The Scene
“A difficult time to invest.”
“Everybody’s paralyzed.”
“I’m sorry I can’t be particularly positive.”
“The chaos that is reigning right now is causing everyone to sit on their hands.”
That’s Citadel CEO Ken Griffin, ON Semiconductor CEO Hassane El-Khoury, Franklin Templeton CEO Jenny Johnson, and Nasdaq Private Market CEO Tom Callahan on the world of Donald Trump right now. Their comments over the past week capture a growing disquiet among business leaders, a month into a presidency that many of them had cheered.
“What decision do you make? Do you want to go left or right?” El-Khoury told Semafor in an interview this week. “Are we going to grow the business? Well, I don’t know. Are there tariffs or not?” (Since that interview, Trump threatened to double his own proposed 10% tariffs on China and put a 25% levy on European goods.)
CEO optimism is fading as Trump pushes ahead with trade restrictions, while business-friendly deregulation has yet to materialize. US consumer confidence in January recorded its biggest one-month decline since November 2023. The US stock market, long Trump’s preferred proxy for economic might, is lower than it was before his inauguration, trailing major indexes in Europe, China, Mexico, and Canada — all targets of the president’s planned tariffs.
Microsoft — whose CEO, Satya Nadella, joined the post-election pilgrimage to Mar-a-Lago — is calling on the White House to ease export limits on AI chips to allied or neutral countries. Chevron may lose a lucrative drilling concession in Venezuela over Trump’s immigration spat with that country’s strong-arm leader.
Trump’s picks to run key regulatory agencies, including those overseeing antitrust and the airwaves, appear likely to continue Biden-era enforcement priorities while adding new ideologically driven crackdowns and corporate purity tests. His pick to run the Federal Trade Commission, Andrew Ferguson, reaffirmed tough merger guidelines put in place by his predecessor, Lina Khan, which will do little for M&A, already off to its slowest start in a decade.
The Trump administration sued last month to block HPE’s takeover of Juniper, and said in a court filing last week that it’s unlikely to settle a lawsuit brought by the Biden administration seeking to block a travel-software merger.
“There isn’t a serious CEO in America who would prefer the disastrous, negative-growth policies of the previous administration over the pro-growth, low-tax, and low-regulation policies of President Trump,” White House spokesman Harrison Fields said. “In just four weeks, more than $1 trillion in private investment has flowed back into our country, and that’s a direct result of the Trump Effect, which is laying out the welcome mat for investment.”
Corporate executives making decisions on multiyear timeframes are struggling to decide whether to take Trump seriously, literally, or neither, and plan for a future after 2028. “You can’t move a factory overnight,” El-Khoury said. “It takes four years to build a fab.”
Onsemi gets about one-third of its revenue each from the US, Japan, and China, where half of its buyers are companies assembling cars or phones there for export. “Do you ignore it?” he said of Trump’s tariff threats, which expanded Wednesday to include a proposed 25% levy on European goods. “Or do you start doing scenario planning? That takes a lot of time and bandwidth.”
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Liz’s view
“’I never thought leopards would eat my face,’ sobs woman who voted for the Leopards Eating People’s Faces Party,” reads a 2015 tweet that has come to symbolize regretful voters facing the consequences of their ballots, like Brexiteers bemoaning Britain’s economic woes.
The business community is having its own leopard-eating-faces moment. The stock market has not been the curb on Trump’s policy agenda that many hoped it would be, and so far they are getting a lot of the bad chaos they feared with little of the good chaos they wanted.
This looks especially true in Big Tech, whose CEOs were among MAGA’s most enthusiastic converts. Trump has appointed fierce skeptics of the legal protections that social media platforms enjoy, and it’s unclear whether the industry’s about-face on content moderation will be enough to keep them out of trouble.
HPE, trying to save its Juniper acquisition, and Microsoft, trying to save its AI revenue, are playing the China card, but the fact that they have felt the need to do so publicly, rather than in one-on-ones with the president at Mar-a-Lago, suggest that the influence channels that corporate America had counted on aren’t open.
Room for Disagreement
It’s still early days — somehow just No. 38 of this administration — and as El-Khoury told us, many key roles in the executive branch remain unfilled. Presidents tend to lead with their most ideological picks and get more technocratic as they go down the chain, so there’s plenty of time for corporate lobbying to make its mark.
“President Trump will decide what he wants to call off and what he doesn’t, but he wants everybody at the table,” National Economic Council Director Kevin Hassett told CNBC earlier this month, saying the administration’s moves were more about creating “leverage” than setting any single policy in stone.
And for all their corporate complications — Goldman Sachs economists estimate that every 5 percentage point increase in tariffs will reduce S&P 500 earnings by 1 to 2% — trade rebalancing has its beneficiaries, too. “It’s a very exciting time for us,” the chief executive of JSW Steel told Fox News last week. Foreign companies including Nissan and Mercedes Benz have said they may move more production to the US to be closer to customers.
Notable
- The vibe shift hasn’t yet come to Big Pharma: Endpoints News’ Andrew Dunn “didn’t hear a single shout-out in defense of the NIH, FDA, or CDC” at a conference this week that hosted the CEOs of Pfizer, Merck, GSK, and Novartis.
- Ford CEO’s comments two weeks ago are looking prescient: “a lot of cost and a lot of chaos.”