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How Tariffs Are Crushing Small Businesses
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Good morning, CFOs. Small business owners are laying off staff and tapping personal savings; companies' pension funding increases; plus, the U.S. and China agree to large tariff cuts.
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Joe Bissonette, who makes tents in Colorado from imported fabric, has cut production in half and laid off one of his five employees. PHOTO: SKY VIEW TENTS
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The owner of a San Francisco card-game company cashed in his money-market funds. The founder of a tent maker is looking for investors. A watch and jewelry company in Colorado is holding off on signing a new office lease. And a New Hampshire consumer-product company has laid off more than half its staff.
Around the country, small businesses that import goods made in China are taking actions—big and small—to try to outlast the current 145% tariff regime on items from that country. But many are worried that their companies won’t survive.
“Nobody in power seems to care about small business,” said Scott Anderson, owner of 5 Star North, which works with Chinese manufacturers to make its products ranging from acrylic markers to tiki torches. “At this point the only option I see is selling out the rest of what we have and shutting our doors.”
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Content from our sponsor: Deloitte
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Highmark Health’s CFO on Evolving Finance From Scorekeepers to Advisors
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Highmark Health CFO Carl Daley discusses how finance operates at the center of a blended insurance and health care provider structure, with new data-centered efficiencies and capabilities to deliver value-based care for the patient community. Read More
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Monday
Earnings: DaVita, Fox, Monday.com, NRG Energy and Simon Property Group
Tuesday
Earnings: On Holdings, Sony Group and Tencent Music Entertainment Group
The National Federation of Independent Business releases its Small Business Optimism Index for April.
The Bureau of Labor Statistics releases the consumer price index for April.
Wednesday
Earnings: Alcon, Cisco Systems, Coreweave and Steris
Thursday
Earnings: Alibaba Group Holding, Applied Materials, Birkenstock Holding, Cava Group, Deere, Doximity and Walmart
The Census Bureau reports retail sales data for April.
The BLS releases the producer price index for April.
The National Association of Home Builders releases its Housing Market Index for May.
Friday
The University of Michigan releases its consumer sentiment survey for May.
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Companies' Pension Funding Increased in April
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The estimated funding level of pension plans sponsored by S&P 1500 companies increased 1 percentage point in April to 104% as a result of an increase in discount rates partially offset by a decrease in domestic equities, according to consulting firm Mercer. As of the end of April, the plans' estimated aggregate surplus increased by $15 billion, to $55 billion, compared with a $40 billion surplus at the end of March, Mercer said.
"We saw domestic equities sell off significantly in early April following the tariff announcements, leading to a surge in market volatility," said Mercer partner Scott Jarboe. "On the other hand, international equities had a strong month, pairing with another modest discount rate increase, resulting in the pension funded status improving for the month."
—Jennifer Williams
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What Else Matters to CFOs
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US Trade Representative Jamieson Greer, left, and US Treasury Secretary Scott Bessent, right, speak during a press conference after two days of closed-door discussions on trade between the U.S. and China. Photo: JEAN-CHRISTOPHE BOTT/EPA-EFE/Shutterstock
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A few days ago, it would have seemed almost impossible, but on Monday, to the surprise of global investors and everyday businesses fearing a trade war, the U.S. and China agreed to a major de-escalation.
The world’s two biggest economies unwound for now most of the tariffs they had imposed on each other since April in a tit-for-tat battle that had threatened to upend the global economy.
The U.S. agreed to lower to 10% the so-called reciprocal tariffs levied on China, which President Trump had ratcheted up to 125%. China, similarly, agreed to cut its retaliatory tariff on U.S. goods to 10% from 125%.
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The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax accounting, regulation, capital markets, management and strategy. Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew. You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.
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