What we’re reading (4/15)
“Treasury Secretary Scott Bessent To Yahoo Finance: Not All Tariff Deals Will Be Done In 90 Days” (Yahoo! Finance). “‘Let's set aside China. There are 15 large trading partners. We set aside China. There are 14, and we're in rapid motion and setting up a process for the 14 largest trading partners, most of whom have very large deficits. So, in 90 days, are we going to have a complete doc, a formal legal document done and dusted? Not likely,’ US Treasury Secretary Scott Bessent told Yahoo Finance Tuesday in an exclusive interview. ‘But I think if we follow the process, we could have substantial clarity on those 14 away from China in terms of agreements in principle. And then once we reach a level that we've agreed on and they've agreed to lower their tariffs, lower their non tariff barriers, currency manipulation, and subsidies of industry and labor, then I think we can move forward,’ he continued.”
“Is Dollar Weakness A Panic Signal Or Healthy Rebalancing?” (Joachim Klement). “In short, we may be seeing the end of U.S. exceptionalism in real time. But it is not the end of the U.S. dollar as the world’s reserve currency. What we are witnessing is likely a rebalancing of international investment portfolios, which, over the last decade, have become increasingly concentrated in U.S. assets. For example, the U.S. share of the MSCI World stock market index has risen from 48% in 2010 to 73% today. In a way, this is reminiscent of what occurred after the tech bubble burst in 2000. Back then, investors gradually reduced their U.S. portfolio allocations in favour of European and Asian investments after the U.S. market share in the MSCI World had risen from 40% to 60% in just five years.”
“Fed Resists Pressure To Rescue Treasury Market” (Semafor). “[T]he Fed isn’t accelerating regulatory changes that would encourage banks to load up on government debt, people familiar with the matter said, even though Treasury Secretary Scott Bessent and JPMorgan CEO Jamie Dimon both support the idea. Tweaks to rules that currently penalize banks for holding big slugs of Treasury bonds are instead winding their way through a painstaking internal process that could take months, the people said.”
“Inside Mark Zuckerberg’s Failed Negotiations To End Antitrust Case” (Wall Street Journal). “Mark Zuckerberg called the head of the Federal Trade Commission in late March with an offer: Meta would pay $450 million to settle a long-running antitrust case that was about to go to trial. The offer was far from the $30 billion that the FTC had demanded…[o]n the call, Zuckerberg sounded confident that President Trump would back him up with the FTC, said people familiar with the matter…FTC Chairman Andrew Ferguson found the offer not credible, and wasn’t ready to settle for anything less than $18 billion and a consent decree. As the trial approached, Meta upped its offer to close to $1 billion, the people said, and Zuckerberg led a frenzied lobbying effort to avoid the FTC trial. It wasn’t enough. On Monday, the trial kicked off.”
“Red-Hot Netflix Is Proving Itself As A Recession-Resistant Stock” (Insider). “As major stock indexes have gotten off to a rocky start this year, Netflix has been a beacon of strength, handily outpacing the broader market and its mega-cap tech peers. The company has climbed more than 10% since the start of January, compared to an 8% loss for the S&P 500 and an even-sharper 17% decline for the elite Magnificent 7 cohort.”
