crypto20180402_16.txt

 Good Thursday. Here’s what we’re watching: • The markets and Trump’s tariffs. • Jared Kushner is criticized for meetings with business moguls who later helped his family’s company. • Stephen Schwarzman had a good 2017. • Walmart is the latest business to wade into the gun debate. • And Spotify opens its books ahead of its direct listing. Want this in your inbox every morning? Sign up here. Investors might be tempted to take a trade skirmish in stride. When President George W. Bush slapped high tariffs on steel imports 16 years ago, the stock market slipped a bit but recovered in the following days. Likewise, stocks may bounce back from the decline that followed the news on Thursday that President Trump will soon introduce tariffs on steel and aluminum. In recent years, the global economic order appeared to be under threat a number of times. But stock markets rebounded from Britain’s vote to leave the European Union, Europe’s sovereign debt crisis, and the debt-ceiling clashes in the United States. And there is a good chance that President Trump’s tariffs won’t cause a great deal of collateral economic damage. They may end up being softer than Thursday’s headlines suggest, as globalists push back. And like President Bush’s tariffs, President Trump’s may be quite narrow in focus and exist for a relatively short period. Investors could learn to live with those, just as they’ve mostly shrugged off possible changes to the North American Free Trade Agreement. But vulnerabilities exist right now that could magnify any negative impact of President Trump’s tariffs. The stock market is still highly valued after a searing rally that took it to an all-time high in January. The Federal Reserve expects to increase interest rates multiple times this year. Compare that with March 2002, when President Bush introduced his trade restrictions: The Fed was cutting interest rates, a policy stance that can help support the economy and the stock market; stocks were nowhere near their peak of two years earlier; and President Bush’s administration was, overall, globalist in its outlook and didn’t want to become isolated ahead of the Iraq war. Importantly, the United States economy is less dominant than it was 16 years ago. Last year, the United States accounted for an estimated 24 percent of the world’s gross domestic product, using data from the International Monetary Fund. In 2002, the share was 32 percent. If other countries retaliate, and tariffs broaden, the United States’ economy may be less resilient than some in the Trump administration may believe. — Peter Eavis We asked yesterday if his family’s real estate business was his biggest liability. Our colleagues’ latest story shows that might be the case. What happened • Josh Harris of Apollo Global Management, an adviser on infrastructure issues, met with Mr. Kushner several times last year. In November, Apollo lent $184 million to Kushner Companies, triple the size of the investment firm’s average property loan. • Citigroup’s C.E.O., Michael Corbat, met with Mr. Kushner in the spring, and shortly afterward the bank lent Kushner Companies $325 million. Mr. Kushner, his family business, Apollo and Citi all said that nothing improper had happened. But the meetings raise questions about how the Kushner Companies is weighing down the political fortunes of President Trump’s son-in-law. Mr. Kushner has already had his interim security clearance downgraded amid a feud with the White House chief of staff, John Kelly. The WSJ editorial board writes, “Mr. Kushner and Ivanka have to decide if they’d serve themselves and the president better by walking away from their formal White House roles.” The politics flyaround • The White House is set to announce new tariffs on steel and aluminum imports, according to unidentified sources. (Bloomberg) • Hope Hicks, the White House communications director and one of Mr. Trump’s closest aides, plans to step down. (NYT) • Mr. Trump publicly criticized Attorney General Jeff Sessions as “DISGRACEFUL” for not ordering his own investigation into the handling of the Russia inquiry. (NYT) From Ana Swanson of the NYT: U.S. stock markets slipped around the time Mr. Trump made his comments about tariffs, with declines in the industrial sector outpacing the overall market. The Standard & Poor’s 500 industrial sector was down more than 2 percent, compared to the overall benchmark index which was down a bit less than 1 percent as of around 1:30 p.m. Automakers, large consumers of steel and aluminum, fell sharply. Another large consumer of those materials, aircraft maker Boeing also declined. As the country’s largest exporter, Boeing would also likely be affected by rising global trade tensions if other nations responded to tariffs from the United States. The comments also come on the same day as Bill Dudley, president of the New York Federal Reserve, said this about protectionism: The co-founder and chief executive of Blackstone raked in $786.5 million last year, his biggest take-home ever, according to Bloomberg. By comparison • Apollo’s Leon Black took home $191.3 million • Carlyle co-founders David Rubenstein, Bill Conway and Dan D’Aniello divvied up a combined payout of $193 million. • KKR’s Henry Kravis and George Roberts received a combined $343 million. Jerome Powell, the new chairman of the Federal Reserve, said before the Senate Banking Committee: Context Mr. Powell said the House Financial Services Committee on Tuesday that the outlook for the United States economy had brightened in recent months. He added that the Fed expected to continue raising rates gradually and could even pick up the pace. The markets seemed to interpret the remarks as signaling the Fed would be more aggressive than expected in raising rates. But there was more evidence Thursday morning that inflation may accelerate this year.  Here are the  numbers from the Commerce Department: • Consumer prices as measured by the personal consumption expenditures (PCE) price index, rose 0.4 percent. • That was the biggest increase since September.In the 12 months through January, the PCE price index rose 1.7 percent. • So-called core PCE, which excludes food and energy, the PCE advanced 0.3 percent in January — the largest gain since January 2017. • Year-over-year core PCE, the Federal Reserve’s preferred inflation measure, rose at 1.5 percent in January. • The core PCE price index has undershot the U.S. central bank’s 2 percent target since mid-2012. Just as the company isn’t holding a traditional I.P.O., it isn’t holding the usual kind of marketing road show either. On March 15, the music streaming giant will — what else? — live-stream a presentation for potential investors. Here’s what to expect, from the company’s prospectus: Spotify adds that it will hold additional “investor education meetings,” which would likely be reserved for the most important investors. While traditional I.P.O.s generally post video versions of their road show presentations on sites like RetailRoadShow, the company looks like it’s trying something different. — Michael de la Merced DoorDash, the food delivery startup, raised $535 billion from a group of investors led by SoftBank’s Vision Fund and that included Sequoia Capital and Singapore’s sovereign wealth fund. The amount is almost triple what the company had raised in the last five years, Bloomberg reported and values the company at $1.4 billion. DoorDash uses a courier model popularized by Uber, meaning that it sends independent contractors to pick up and deliver orders. The company said it has partnered with nearly 90 percent of the top 100 restaurant chains, including Wendy’s, Chick-Fil-A, IHOP, PF Chang’s, the Cheesecake Factory and Five Guys. It was one thing for Dick’s Sporting Goods to set an age requirement for firearms sales. It’s another for the country’s biggest gun seller to do something similar. What each is doing: Walmart: Raising the minimum age for purchases of guns or ammunition to 21, and eliminating products that look like assault-style rifles. (The company stopped selling AR-15s two years ago.) Dick’s: Requiring buyers to be at least 21 and dropping AR-15s from its 35 Field and Stream outlets. The NYT notes that Walmart explicitly linked the new rules to the school shooting in Parkland, Fla. The company said in its statement, “In light of recent events, we’ve taken an opportunity to review our policy on firearm sales.” The gun control debate remains a tricky one to navigate, though more C.E.O.s feel compelled to speak up. Michael Dowling of Northwell Health told the WSJ, “We are people that other people look up to.” A caveat: While some capitalist activists are urging big mutual funds to sell stocks in gun companies, Stephen Gandel of Gadfly argues that such divestment campaigns don’t work. The political context: President Trump made a surprising pitch for tougher gun regulations and urged Republicans to push back against the National Rifle Association. The group called his move “great TV” but “bad policy.” • Meet Martin Gilbert, whose investment fund could help decide whether the satellite broadcaster Sky sells itself to Comcast or Fox. (Bloomberg) • Bayer is willing to sell more assets to win regulatory approval of its $62.5 billion takeover of Monsanto. (WSJ) • Saudi Arabia’s sovereign wealth fund has invested more than $200 million in Penske Media, the owner of Rolling Stone and Variety, according to an unidentified source. (NYP) • The British insurer Equitable Life has hired Goldman Sachs to examine a possible sale. (FT) The hedge fund mogul finally called quits on his five-year campaign against the supplements company Herbalife, which he called a pyramid scheme and whose stock he once declared would go down to zero. A look back at the famous short bet, from Matthew Goldstein of the NYT: Herbalife’s shares closed yesterday at $92.10, a record high. Memories: Herbalife was at the center of Mr. Ackman’s infamous televised debate with Carl Icahn, who was (and still is) betting on the company’s ability to grow. Where Mr. Ackman is focused now: United Technologies, the subject of rumors that the conglomerate may break itself up. Brooke Sutherland of Gadfly applauded the back-to-activism-basics bet. In other hedge fund news: David Einhorn had a bad month. Viking Global Investors is the latest firm to wade into big-data analytics. The British retailer Whitbread is holding firm against an activist campaign by Sachem Head. David Rubenstein, the Carlyle Group co-founder, told CNBC at the SuperReturn conference in Berlin that, over all, businesses support the White House’s economic policies: Why? Largely the tax cuts, for which both Republicans and Democrats are compiling data  to support their political arguments. In other economic news: Liu He, Beijing’s top economic adviser, met with American business leaders like Jamie Dimon of JPMorgan Chase and David Solomon of Goldman Sachs amid heightening trade tensions between China and the U.S. had a bad month. Viking Global Investors is the latest firm to wade into big-data analytics. The British retailer Whitbread is holding firm against an activist campaign by Sachem Head. The commission has sent subpoenas to people and companies who have arranged initial coin offerings, signaling that tighter regulations may be in the offing. More from Jean Eaglesham and Paul Vigna of the WSJ: The virtual currency flyaround • How productive is spending money and natural resources on … buying digital money? (NYT) • Could your internet-connected security camera be hijacked to mine virtual currencies? (CNBC) • Bitcoin is at $10,666.90 this morning, according to CoinMarketCap. • As Brexit looms, not everyone wants Britain’s Serious Fraud Office to be completely successful in cracking down on corporate crime. (Businessweek) • A former fraud investigator for Wells Fargo said the bank fired him in retaliation for his internal complaints about mishandled inquiries. (NYT) • Bank of America has fired two employees for interfering in an investigation into Omeed Malik, a former executive accused of sexual misconduct, according to unidentified sources. (WSJ) • Goldman Sachs and Société Générale have submitted final bids for the Commerzbank unit that houses the lender’s exchange-traded fund business, unnamed sources said. (Bloomberg) • Two experts debate the merits of rolling back banking regulations. (FT) • How low can unemployment go? Economists have no idea, and their uncertainty has huge consequences. (NYT) • Auto-parts suppliers have called for cleaner cars, splitting with their main customers: automakers. (NYT) • Exxon Mobil is abandoning its joint exploration ventures with Rosneft, retreating from what was one of its most promising investments until Western sanctions got in the way. (NYT) • The tech entrepreneur Susan Wu has started a school in Australia, but critics worry about Silicon Valley overreach. (NYT) • Everything that made Warren Buffett the celebrated investor he is lines up with what we’ve learned about the tendencies of female investors. (Bloomberg) • Fosun International is looking for more deals abroad, and its chairman says there are no financial or political barriers in its way. (FT) • The Microsoft co-founder Paul Allen said he was investing an additional $125 million into his nonprofit computer research lab for an effort to teach machines “common sense.” (NYT) We’d love your feedback. Please email thoughts and suggestions to bizday@nytimes.com.