Washington Post Industry Wrap: May 31, 2018

The 15th Annual Automotive Supply Chain Symposium presented by KPMG and the National Automotive Dealers Association continues in Northville, Michigan. Speaker coverage includes: Richard Elliott, president and chief executive officer, Sonoco Products; Tim Brooks,…

Washington Post Industry Wrap: May 31, 2018

The 15th Annual Automotive Supply Chain Symposium presented by KPMG and the National Automotive Dealers Association continues in Northville, Michigan. Speaker coverage includes: Richard Elliott, president and chief executive officer, Sonoco Products; Tim Brooks, author, “Lost Tycoon, Andrew Carnegie: Photographs, Photographs, Photographs”; Darryl D.

As independent businesses receive increased scrutiny from antitrust authorities, some are preparing to self-select new partnerships in order to avoid being dragged into lawsuits. In another example, The Wall Street Journal reported that a Fortune 500 clothing company could be in line for a $1 billion acquisition after it sold the majority of its noncore operations to a private equity firm. JPMorgan Chase says price pressure isn’t hurting demand for its loans. It is all underscored by the fact that just $10 trillion of the $24 trillion in assets that exist today in the U.S. financial system are “tied directly to the U.S. economy.” The idea of high financial risk can indeed reflect reality. However, the market for nonbank lenders, consumer credit, asset-backed securities and commercial real estate may not give the impression it is an extension of the financial system. For its part, NABDA announced a $500 million funding effort and data analytics to help members enhance their visibility and strengthen their brands. For now, some of the risk aversion is understandable.

States across the nation have stepped up enforcement of provisions in the Dodd-Frank law that prevent financial holding companies from engaging in insurance activities, but not a ton of lawsuits are expected to come out of that. This is not the end of the story, though. For example, if an insurer violates the requirements, could this become a penalty for insolvency? Kevin O’Brien reports. Another example: South Carolina regulators reportedly gave the go-ahead for Charleston-based Sea Breeze Life Insurance Co. to buy rivals in Louisiana. The buyout was termed a surprise, and both sides are contending for glory.

U.S. markets suffered an unprecedented loss on Friday, days after the administration announced tariffs on steel and aluminum imports. The Trump administration expressed doubts that other countries could pay for tariffs to retaliate with their own actions. According to a survey from Bank of America, 44 percent of respondents who own shares of publicly traded industrial companies expect the tariffs to reduce U.S. sales, an industry that tends to be more price sensitive than other industries. In the U.S., the Office of the U.S. Trade Representative posted a fact sheet on its website, which includes raw and semi-finished steel supply chains. For a glimpse of the costs that might be incurred, the graphs are depressing, as shown in a Quartz roundup.

U.S. Department of Agriculture Secretary Sonny Perdue met with agricultural representatives in Napa, California, to talk about addressing the “ropes of disease,” according to the USDA. For his part, Congressional Agriculture Committee Chairwoman Collin Peterson, a Democrat from Minnesota, criticized the administration’s focus on agricultural trade while other problems, such as the creation of a healthcare system under Trump, go unaddressed. As they have in the past, farmers in favor of a strong trade relationship with the U.S. might be able to influence policy changes, but as Peterson noted, “I’m kind of more interested in all the stuff that’s going on in the background.”

Sweden’s prime minister is poised to lead the European Union against President Trump’s trade policy. Although she has yet to definitively say whether she will enter the EU presidency, Stefan Löfven has vowed to make defending the bloc’s interests a top priority. In an opinion article published by Business Insider, Löfven said the EU needs to form a common position regarding Trump’s policies on steel and aluminum.

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