US futures markets fell and the dollar dropped to a two week low following the resignation of Donald Trump's top economic advisor yesterday. Gary Cohn appears to have resigned over Donald Trump's plans to place hefty tariffs on steel and aluminium imports.
Mark Weinberger is Global Chairman and CEO of international business advisory at accounting firm EY. In the past he was a Treasury Department Assistant Secretary for Tax Policy in the administration of George W Bush.
Mr Weinberger said it was speculation that the tariff plan was why Gary Cohn had departed, but he said he was a known opponent of trade barriers. "He has been an unabashed free trader and believes that in capital markets, money should flow. He would not be a fan of economic warfare with tariffs.
"We've seen tariffs in the past in different administrations. The real concern is that this is a signal that Trump will be more of a protectionist president who is more interested in entering into trade wars. Will there be a tit-for-tat and will this strangle growth in the global economy?" he asked.
Mr Weinberger was a member of Donald Trump's now defunct Strategic and Policy Forum which was dissolved in the wake of controversy over the President's reaction to the Charlottesville riots last summer. "It was a great way to dialogue with the President. He was actively engaged before we disbanded it. It was very healthy to have that dialogue between business and government. I strongly believe it's better to be in the room than being outside complaining."
He also credited Mr Trump with doing a good job economically by focusing on deregulation and tax reform. "I don't agree with any president on every issue but the bottom line is we need to support the pilot who's flying the plane. We need to ensure US growth is supporting global growth."
On the massive tax reform introduced by the Trump administration before Christmas, Mr Weinberger said the changes introduced a more competitive element to the regime. "It has reduced the corporate tax rate from the highest in the OECD to the middle of the pack. It's not a tax haven but it is more competitive. It'll make investment (into the US) more attractive, but there's no way that companies will pull back from investing overseas."
"Ireland has a very competitive tax rate and a very transparent and consistent system. It's going to be the place to invest into Europe from. Companies are not going to pull up or pull out," he concluded.
MORNING BRIEFS - International Paper - the company that made an unsolicited bid for Smurfit Kappa - has confirmed that it submitted a cash offer of €22 per share. It also offered 0.3 new shares in its company for each Smurfit Kappa share. It calculates that at valuing each Smurfit Kappa share at €36.46. Shares in the company closed at €33.86 last evening - a gain of over 18% in the day. Smurfit Kappa has rejected the approach.
*** Bookmaker Paddy Power Betfair has reported revenue up 13% to £1.745 billion for the 2017 financial year. Earnings per share of £3.98 was up by a fifth. It is proposing a final dividend per share of £1.35 bringing total dividends for the year to £2 per share.
*** And Donald Trump has fallen 222 places on the Forbes Rich List as his estimated worth fell to $3.1 billion from $3.5 billion. Forbes said the drop was partially due to a fall in New York property values and falling revenues at his golf courses. Michael O'Leary has joined the billionaire's list for the first time.