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Apple CEO: Tariffs shouldn't affect iPhone

In an exclusive broadcast interview, Apple CEO Tim Cook tells Laurie Segall that's he's optimistic the US will avoid a trade war because it's a "lose-lose" situation.

Posted: Jun 5, 2018 12:12 PM
Updated: Jun 5, 2018 12:15 PM

America's leading CEOs are scaling back plans for hiring and spending because of President Trump's aggressive trade policy.

The Business Roundtable said on Tuesday that its CEO economic outlook index declined this quarter from a record high. It was the first drop in two years.

The powerful lobby, chaired by JPMorgan Chase boss Jamie Dimon, blamed the more cautious attitude on "increased uncertainty" about the direction of US trade policy.

Backing up his campaign promises, Trump has attacked existing trade relationships with China, Europe, Canada and Mexico. He has imposed tariffs on close allies and threatened tariffs on China, raising the specter of a costly trade war that would dent economic growth.

Sixty-three percent of CEOs polled last month by the Business Roundtable said it was a "serious" risk that foreign trade retaliation would hurt American exports. Another 32% called it a "moderate" risk.

"Trade policy is a large and growing concern affecting CEO decision-making and the economy as a whole," Joshua Bolten, CEO of the Business Roundtable and a former chief of staff to President George W. Bush, told reporters during a conference call.

CEOs dialed back their US hiring plans for the next six months by 13% and their business spending expectations by 4%. The outlook for sales also dimmed.

Related: Tim Cook isn't too worried about a trade war

The Business Roundtable said that unlike on other issues, Trump and his advisers have so far rejected their advice on trade.

"We hope they listen to us, but so far they have not," Dimon said. He said the White House is making a "mistake" by pushing certain changes to NAFTA, such as adding a sunset provision that would make the agreement expire after five years.

The JPMorgan CEO said the economic recovery from the Great Recession could last several more years, unless Trump's trade agenda causes serious problems.

"One of the flies in the ointment is this trade stuff," Dimon said. "It's not only directly affecting our decisions, but it's creating uncertainty."

The more careful tone from business leaders stands in contrast to their extreme optimism when Trump and other Republicans slashed the corporate tax rate and provided a huge break on foreign profits returned to the United States.

Although the tax plan has led to skyrocketing stock buybacks and one-time bonuses for millions of employees, economists see little evidence CEOs are accelerating job-creating investments in their companies.

The Business Roundtable's CEO outlook index remained strong, and above historical averages for the sixth straight quarter. But it dipped in the second quarter to 111.1 from a record high of 118.6 in the first three months of the year.

Related: Trade wars are scary. Why isn't Wall Street freaking out?

Worries about a trade war are on the rise.

Last week, Trump reversed talk of a truce with Beijing by resuming plans to impose tariffs on $50 billion worth of Chinese goods. The administration, citing national security concerns, also hit close allies Canada, Mexico and the European Union with steel and aluminum tariffs.

Eighty-nine percent of CEOs polled by the Business Roundtable worry that Trump's approach to trade will slow the economy. And 90% think his trade stance will lead to higher costs for US businesses. Many companies are already grappling with increased expenses.

"It doesn't help US jobs," Howard Schultz, the outgoing executive chairman of Starbucks, told CNN's Poppy Harlow last week.

"Every time that we have had a conflict of trade and there have been trade wars," Schultz said, "it has resulted in a downturn of the economy of the United States."

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 918230

Reported Deaths: 15011
CountyCasesDeaths
Marion1252491952
Lake623371084
Allen52301746
Hamilton43009443
St. Joseph41155584
Elkhart32831485
Vanderburgh29698436
Tippecanoe26442247
Johnson23106414
Hendricks21708338
Porter21255340
Clark16988222
Madison16899378
Vigo15562272
Monroe14186190
LaPorte13961235
Delaware13613215
Howard13531258
Kosciusko11150134
Hancock10534159
Warrick10431174
Bartholomew10233166
Floyd10099202
Wayne9557216
Grant8858194
Morgan8654158
Boone8231109
Dubois7521123
Henry7391126
Dearborn734186
Noble7208100
Marshall7168127
Cass7060117
Lawrence6803150
Jackson638980
Shelby6386106
Gibson5999105
Harrison587984
Huntington586490
Montgomery5663101
DeKalb555691
Knox532999
Miami523183
Clinton522464
Putnam519067
Whitley509851
Steuben480267
Wabash470192
Jasper465760
Jefferson456091
Ripley439074
Adams435565
Daviess4008106
Scott389563
White383457
Decatur376895
Clay376455
Greene375589
Wells375183
Fayette363074
Posey351841
Jennings341756
Washington324046
LaGrange312074
Spencer310734
Fountain306553
Randolph302087
Sullivan294947
Owen275961
Orange269659
Starke268961
Fulton264451
Jay248134
Perry244950
Carroll239926
Franklin229337
Vermillion225850
Rush225530
Parke212020
Tipton205354
Pike200938
Blackford163834
Pulaski155250
Crawford140818
Benton138316
Newton138141
Brown130646
Martin124416
Switzerland122310
Warren112616
Union92211
Ohio75811
Unassigned0461

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 1319265

Reported Deaths: 21265
CountyCasesDeaths
Franklin1480641537
Cuyahoga1311202313
Hamilton948871307
Montgomery647451122
Summit548531041
Lucas49502853
Butler45993649
Stark39954963
Lorain30438525
Warren29170326
Mahoning25988629
Clermont24726278
Lake24088411
Delaware21722140
Licking19822239
Fairfield19780218
Greene19671266
Medina19208285
Trumbull19195506
Clark17188321
Portage15585224
Richland15540228
Wood15187208
Allen13654254
Miami13283244
Muskingum11821148
Wayne11448234
Columbiana11100239
Tuscarawas10388264
Marion10273144
Pickaway10162128
Scioto9766124
Erie9479170
Ross8979172
Lawrence8225116
Hancock8105140
Ashtabula8083184
Geauga7976155
Belmont7791183
Jefferson7093168
Huron7087125
Union703549
Washington6823116
Athens666163
Sandusky6608132
Darke6394135
Knox6308120
Seneca6113135
Auglaize569888
Ashland5631110
Shelby555799
Mercer545188
Brown533067
Defiance5278100
Madison527368
Crawford5148113
Highland514876
Fulton508781
Clinton505379
Logan494582
Preble4788110
Putnam4733106
Guernsey439057
Williams437281
Champaign426463
Ottawa425783
Perry414051
Jackson402259
Pike367140
Morrow359149
Fayette353951
Coshocton345064
Hardin341868
Adams338864
Gallia329254
Holmes3148107
Henry312668
Van Wert299269
Hocking280467
Wyandot271858
Carroll250451
Paulding231742
Meigs197842
Monroe178649
Noble160340
Morgan153528
Harrison145740
Vinton130217
Unassigned05
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