Business
Trump, the Deal Maker in Chief, Is Back
The questions facing a new Trump era
Good morning on this Inauguration Day. Welcome to Round 2 of President Donald Trump. No matter your politics, it is likely to be a historic ride.
For business and policy leaders, the next administration is expected to be filled with deals of all sorts — from White House agreements brokered over secure phone lines with foreign powers to congressional backroom pacts to headline-making deals negotiated by Wall Street.
This is a transactional president, perhaps the most transactional ever. He wants to engage with the business community, which is a big distinction from the Biden administration. He takes great pride in publicly name-dropping the C.E.O.s he’s talking with. “Today, I spoke with Tim Cook of Apple,” he told supporters last night. “He said they’re going to make a massive investment in the United States because of our big election win.”
Trump is rooting for big business, until he isn’t. He’s fickle. And uncertain.
That poses a big challenge for business leaders: How and when might Trump’s unpredictability emerge? Is there a red line? C.E.O. calculations have been that a second term means that uncertainty — something many dislike — is a certainty. But many think that they can manage it, or at least they tell themselves they can.
After Trump’s 2016 win, he invited tech C.E.O.s to meet with him (that was, of course, a photo op). They showed up, though many came reluctantly. Others joined his administration’s various councils only to depart when he said things that appeared to cross a line.
This time, many are all-in — at least for now. Some genuinely support him, or at least think he was better than the alternative. Others have taken an “if you can’t beat ’em, join ’em” attitude. Or it may be that his threats, real and imagined, are working. He said as much in a candid moment about his threats to arrest Mark Zuckerberg, Meta’s C.E.O., and the company’s decision to abandon fact-checking on the platform, saying Zuckerberg’s decision was “probably” the result of those threats. (Many of these same people rebuked him after the Jan. 6 attack on the Capitol in 2021).
We will see how long the love affair with business lasts. It may be longer than some skeptics suggest. Now that he’s in power, the business community needs Trump to like them: It’ll need his support if deals and investments are to flourish; it needs him to push the corporate tax rate lower; and the crypto world needs him. (He also needs it given his and his family’s forays into the sector). All of this raises all sorts of questions, as we get into below.
We’ll be here, every morning, reporting on all of it, as well as raising and asking tough questions. I imagine there will be a lot of them. — Andrew Ross Sorkin
TikTok’s fuzzy future
TikTok users in the United States breathed sighs of relief on Sunday after the video platform began to resume service, thanks to Donald Trump’s pledge to suspend a ban of the app.
But while the president-elect took credit for saving the hugely popular app — “So I like TikTok! I had a slightly good experience, wouldn’t you say?” he said at a rally on Sunday — his thinly sketched proposal leaves some big questions unanswered.
What Trump said: His “initial thought,” he wrote on Truth Social, was a 50-50 joint venture between ByteDance, TikTok’s Chinese owner, and an unspecified American entity. It represented Trump’s favorite thing — a deal — and on the surface had some appeal.
Trump added that he envisioned ByteDance handing over half of the company to the U.S. and that the U.S. wouldn’t pay a dime. “Whether you like TikTok or not, we’re going to make a lot of money,” he said.
But hold on a second. Trump hasn’t addressed the thorny national security concerns that persuaded a bipartisan group of lawmakers and President Biden to back the TikTok ban, not to mention who controls the ByteDance algorithm that is the key to the app’s success.
Moreover, it’s not clear how Trump can legally get around the ban. While he has promised to issue an executive order saving the app, the law is still on the books — though Trump can choose how aggressively to enforce parts of it, legal experts say.
Republicans and their allies criticized Trump’s efforts to circumvent the law:
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Senator Tom Cotton, the Arkansas senator who chairs the Senate Intelligence Committee, warned on X that any company that aids “communist-controlled TikTok could face hundreds of billions of dollars of ruinous liability under the law.”
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Speaker Mike Johnson added that he expected the law to be enforced: “The law is very precise, and the only way to extend that is if there is an actual deal in the works,” he said on “Meet the Press” on Sunday.
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Joe Lonsdale, the venture capitalist who’s close to Trump allies like Peter Thiel, wrote on X, “Tomorrow he becomes POTUS, NOT King. Congress and SCOTUS were clear. He can give TikTok 90 days, then if it’s not sold, any company facilitating it is breaking the law.”
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And Elon Musk reiterated that while he didn’t believe in banning TikTok, he found it “unbalanced” that TikTok be allowed to operate in the U.S. but X remains blocked in China. (That said, China’s vice president, Han Zheng, met with Musk and other business leaders to say his country was open to American business.)
What next? Trump will need to flesh out his proposal in the coming days to persuade lawmakers and others that it’s legally sound. Meanwhile, other bidders for TikTok are circling, including the billionaire Frank McCourt, who has assembled a group that wants to buy the app without its key algorithm, and reportedly Perplexity, an artificial intelligence start-up.
For ByteDance’s U.S. investors, which include General Atlantic, Susquehanna and Sequoia, a preferred course — second only to keeping the whole thing intact — may well be to spin the company to themselves. But if China won’t let them keep the algorithm, what would they be left with?
Executive orders galore
In between the dining, dancing and speechifying, President-elect Donald Trump is expected to unveil a flurry of executive orders on Monday.
First up, according to Stephen Miller, Trump’s deputy chief of staff, are major policy shake-ups for energy, immigration and border security, work protections for federal employees, as well as halting or scaling back key planks of the Biden administration’s climate agenda.
D.E.I. is also in the cross hairs. President Biden’s diversity, equity and inclusion measures for federal agencies are expected to be rolled back, just as big companies, such as Meta and Amazon, plan to eliminate or revamp some of these policies.
Electric vehicle credits are on the chopping block. Trump has long promised to undo the Inflation Reduction Act, a law that has supporters among some oil executives. It also extends credits to electric vehicle customers. Withdrawing those could dent sales of E.V.s.
That said, Elon Musk, Tesla’s C.E.O. and a key Trump ally, has suggested his company could weather a pullback.
Crypto bulls rejoice
Stock and bond markets are closed in the United States for Martin Luther King’s Birthday. But crypto trading is available — and it has helped mint Donald Trump as the latest crypto billionaire.
This weekend saw a frenzied rally for Donald Trump and Melania Trump meme coins, prompted by Trump himself. “GET YOUR $TRUMP NOW,” the president-elect told his followers on Truth Social this weekend.
It rallied further when Robinhood, the trading platform that made a big donation to Trump’s inauguration fund, began letting its customers trade the $TRUMP coin.
Bitcoin, which hit a record on Monday, and other digital tokens have soared since Election Day on the hope that the incoming administration will loosen regulation around the sector. That said, the rally in $Trump and $Melania tokens has astounded longtime market watchers.
Ethics watchdogs see the coin as a “profound conflict of interest” for Trump. Though organizers of the Trump coin say that buying it is neither a political donation nor an investment contract, skeptics say it raises questions about the president-elect benefiting from an industry he is supposed to be regulating.
There’s also the question of whether foreign governments could buy into the coin, potentially violating the foreign emoluments clause of the Constitution.
“This may represent the single worst conflict of interest in the modern history of the presidency,” Norm Eisen, a White House ethics adviser during the Obama administration, told The Washington Post.
The big money behind the inauguration
As Donald Trump prepares to take office, one thing is becoming especially clear: Washington is increasingly becoming a city where it pays to pay up.
The inaugural committee has already raised more than $170 million, shattering a record set by the first Trump committee.
Corporations as well as donors have opened their wallets. Apple, Google, Meta and Microsoft all gave millions to Trump this time, taking advantage of the more-permissive rules around donations for post-election activities such as the inauguration.
“Corporate America has embraced President Trump,” Brian Ballard, a powerful lobbyist and Trump fund-raiser, told The Washington Post. “Every corporate client I have wants to be a part of it.”
Critics of such donations point to a pay-to-play culture. An analysis by OpenSecrets of giving to the first Trump inauguration found that more than half of the 63 federal contractors who gave won multimillion-dollar bids in 2017.
Among them:
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For-profit prison operators, including CoreCivic and Geo Group, saw huge increases in contract awards.
David Rubenstein, the billionaire co-founder of the Carlyle Group, put it bluntly to The Times:
Big donors, he said, “would like to get the policies they believe in from the federal government — more oil drilling, easier antitrust policy, more favorable crypto policy, less bank oversight. They also want more support for helping American companies invest overseas, and have ready access to government officials.”
How Trump’s inauguration stacks up
The inauguration of Donald Trump as president will be a pricey and star-studded affair.
Carrie Underwood, Rascal Flatts and the Village People are set to perform. And Snoop Dogg headlined Friday’s black-tie “Crypto Ball,” a $2,500-a-ticket gala that hailed Trump as “the first crypto president.”
Inauguration celebrations have changed significantly over the course of American history: The more lavish the festivities, the greater the statement. On the unpretentious side were those for Thomas Jefferson and Jimmy Carter. The co-chairman of Carter’s inaugural committee told The Times that the goal was “an inauguration which is traditional but modest in one, not extravagant.”
Barack Obama declined corporate donations for his first inauguration (though he still managed 10 official balls and a performance by Jay-Z) before accepting them for his second inauguration. President Biden’s pandemic-marred inauguration ended with fireworks, but there were no galas.
Trump’s festivities may draw comparisons to those of Ronald Reagan, whose 1981 inauguration fund set a record by raising $8 million (about $29 million in today’s money). As The Times described the day:
In white and black tie, in sequins and sables and clouds of perfume, Republican revelers stepped out tonight to the most lavish series of inaugural balls ever held in the nation’s capital.
It was an evening of shiny black limousines and nostalgic swing bands, of glittery Hollywood celebrities and wealthy Western oil men. The aura of big money was everywhere.
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Across Europe, the lesson from an old proverb just might be taking hold: Fool me once, shame on you; fool me twice, shame on me.
For the second time in under five years, Europe is contending with an energy crisis set off by a war. Europeans have responded to the price shock by rushing to line up heat pumps, solar panels and electric vehicles. They are hoping to lower their bills and reduce their reliance on imported fossil fuels.
In March, the first month of the war in the Middle East, more than 344,000 electric vehicles were registered across Europe, over 40 percent more than a year earlier, according to the European Automobile Manufacturers’ Association. Solar panel sales for Britain’s biggest power company, Octopus Energy, jumped 50 percent. And in Germany, inquiries about residential solar systems doubled compared with recent months, according to E.ON, an energy company.
Over the first three months of the year, about 575,000 heat pumps were sold in 11 large European countries, up 17 percent from a year earlier, the European Heat Pump Association said. The increases were particularly large in France, Germany and Poland.
For Heizma, an Austrian company that installs heat pumps, solar panels and other residential electrification services, sales in March and April broke records.
Since the war stopped a vast majority of fuel shipments through the Strait of Hormuz, the price of European natural gas, which is relied on to heat homes and power factories, has risen about 40 percent.
As prices spiked, interest in alternative energy supplies kept rising. Michael Kowatschew, a founder of Heizma, said customer inquiries were up 20 percent. Many of them invoked the importance of “resilience” and “European sovereignty.”
Russia’s invasion of Ukraine in 2022 was a jolt for Europe, which had been dependent on Russia for critical supplies of energy. European governments turned to other gas and oil exporters, including the United States.
Europeans are noticing “more and more how dependent we are not only on fossil fuels but, through fossil fuels, on other countries and other regions,” Mr. Kowatschew said.
The European Union has spent an additional 24 billion euros on energy imports in under two months, said Ursula von der Leyen, the president of the European Commission.
“Households are now seeing that they are only one Trump-ignited war away from very expensive tank refueling or heating bills,” said Elisabetta Cornago, an energy and climate policy expert at the Center for European Reform.
This “shock-awareness factor” means that demand for electric vehicles, heat pumps and solar panels is likely to keep rising, she said.
Demand has increased even as European governments have started to cut taxes on energy bills and diesel and gasoline at the pump to shield households. The costs of solar panels and electric vehicles, still out of reach for some households, are becoming more affordable. Last week, Volkswagen, Europe’s largest automaker, revealed a new electric vehicle model with a starting price under €25,000 (about $29,000), more than 25 percent below a comparable VW popular model.
In Britain, the government said it would allow the sale of plug-in solar panels within the next few months. These devices, which can be attached to a balcony, can help curb energy bills and don’t require the more expensive installation of rooftop panels. They will be widely available in supermarkets and online.
In the meantime, rooftop solar has become more popular. Danny Hirst, the managing director at the Green Way Solar, which installs solar panels in England, has noticed a sharp increase in interest. Last fall, his company was receiving about 10 inquiries a week. Now, it sometimes gets 20 in a single day, he said.
“The general feeling that we’re hearing from clients now is that they’re just getting fed up with the uncertainty of energy prices,” Mr. Hirst said.
But will the interest be sustained? Companies and business groups said it was too soon to know.
For customers, there’s red tape. It can take weeks or months, partly because of regulatory approvals, for a customer to go from deciding to buy a heat pump or solar panels to installing them.
Then there is the push-pull issue of government policies over financial incentives or subsidies, which can drive consumer demand but cause it to taper if they are not designed properly.
Since the war started, countries across Europe have already put in place short-term measures to lower energy costs — more than €10 billion worth, according to an estimate by Bruegel, a think tank in Brussels.
The measures, such as tax cuts on gas at the pump and electricity bills, are predominately aimed at large parts of the population. Experts said governments should target their assistance to the most vulnerable households, while spending more to subsidize low-carbon energy.
This has echoes of the crisis from 2022. At the time, Europe had suddenly shifted away from Russian gas imported via pipelines, a prominent source of fuel. Energy prices rose sharply. Demand for electric vehicles, solar panels and heat pumps jumped.
But when Europe found other sources of natural gas and prices dropped from their peak, interest in renewable technologies waned. Meanwhile, governments had spent hundreds of billions of dollars to shield households and businesses from high energy costs, further reducing the urgency for households to switch to renewables, some analysts said.
Simone Tagliapietra, an energy and climate policy expert at Bruegel, said the lesson for policymakers from 2022 was that they should increase their support for low-carbon technologies, not broad based-measures that cheapen energy from oil and gas. The moment, he said, presents an opportunity for governments.
“We are facing a full-fledged oil and gas crisis,” Mr. Tagliapietra said.
At the same time, history shows that financial incentives needed to sustain consumer interest in technologies like solar panels must be consistent.
Mr. Hirst of the Green Way Solar has been in the solar industry for nearly a dozen years and has experienced the market’s ups and downs. There was a boom right after the 2022 crisis, he said, but then sales dropped. The promise of subsidies drove up interest in renewable technologies, but consumers then waited to make sure they received a subsidy before deciding to install solar panels or heat pumps.
There is a risk that this could happen again.
In Austria, demand for heat pumps dropped in the first three months of this year when some government funds for subsidies ran out.
Mr. Kowatschew at Heizma, the Austrian installation firm, said he was cautious about expanding too quickly. The company was established only two years ago. Its focus is on finding ways to make the installation process faster and more efficient so that workers can outfit two heat pumps a week instead of one, he said.
Still, business is good. Heizma made about €2 million in revenue in April, he said.
“Everyone now knows electrification makes sense,” he said. “It makes a lot of sense to switch to heat pumps, to solar and green electricity.”
Cloudflare is laying off 20% of its staff, the latest technology company to announce big cuts as it uses more artificial intelligence-powered tools.
The San Francisco web performance and cybersecurity company said it was getting rid of 1,100 people.
“The way we work at Cloudflare has fundamentally changed,” Chief Executive Matthew Prince and Chief Operating Officer Michelle Zatlyn told employees in an e-mail. “We don’t just build and sell AI tools and platforms. We are our own most demanding customer.”
It is the latest tech company this week to announce massive layoffs as tech workers embrace the use of AI agents to perform tasks such as generating code more quickly. Coinbase said Tuesday that it would cut 14% of its workforce, or roughly 700 workers. PayPal is reportedly planning to slash 20% of its staff.
Other companies such as Meta, Block and Oracle have announced layoffs this year. From January to April, U.S. tech employers announced 85,411 job cuts, up 33% from the same period last year, outplacement and executive coaching firm Challenger, Gray & Christmas said Thursday.
Cloudflare’s email, which was published on its blog, said that in the last three months, its use of AI has jumped more than 600%. Employees in various roles in engineering, HR, finance and marketing are running “thousands of AI agent sessions each day to get their work done,” and the company has to be “intentional” as it prepares for the “agentic AI era,” the email said.
Cloudflare executives added that the company is hoping to avoid further major layoffs.
“We are making these changes now because making smaller, repeated cuts or dragging a reorganization out over multiple quarters creates prolonged emotional uncertainty for employees and stalls our ability to build,” the email said.
The company estimates that severance and other restructuring will cost between $140 million and $150 million for 2026.
Cloudflare didn’t say how many of those cuts will be in its San Francisco office. The company has offices in other parts of the world, including Asia, Europe and the Middle East, according to its website.
As of December, Cloudflare had 5,156 employees.
Cloudflare announced job cuts the same day it reported its first-quarter earnings. The company’s revenue jumped 34% year-over-year to $639.8 million in the first quarter. It posted a net loss of $22.9 million.
But the company’s forecast for the second quarter fell short of Wall Street’s expectations. Cloudflare projected revenue of $664 million to $665 million for the second quarter, which was lower than the $666 million Wall Street anticipated.
Cloudflare’s stock dropped roughly 18% to $209 per share in after-hours trading.
The unique global status of the U.S. dollar and financial markets, and the strength of the U.S. economy, have enabled the government to retain its current rating. “A large, dynamic economy, the dollar’s reserve-currency role and the depth and liquidity of U.S. capital markets are key sovereign rating strengths,” Fitch said. But a variety of “governance” issues under the Trump administration, as well as the conflict in the Middle East, along with persistent and widening budget deficits, have challenged that credit rating.
Nonetheless, U.S. Treasuries have attracted global investors as a “safe haven” during the conflict. Other countries, like Britain, don’t have that status now. British 30-year government bonds, known as gilts, have reached their highest level since 1998. And Britain’s benchmark 10-year bond yield was close to 5 percent, a premium of more than 0.6 percentage points above the equivalent Treasury.
Major world central banks have responded defensively to these financial storms. As I wrote last week, the Bank of Japan, European Central Bank, Bank of England and Federal Reserve have all decided to take no action on their key interest rates because of the dual risks posed by rising oil prices resulting from the war with Iran: There are heightened risks of both runaway inflation and throttled economic growth.
That dilemma continues. Kevin M. Warsh, nominated to succeed Jerome H. Powell as Federal Reserve chair, has spoken frequently of the need to trim interest rates but the markets are skeptical. They project no Fed action on rates through December 2027 as the most likely outcome, with a greater possibility of interest rate increases than of reductions, according to futures prices tracked by CME FedWatch.
In short, central banks, which control the shortest-duration interest rates, and the bond market, which sets longer rates, view the economic environment with a jaundiced eye. There is a range of possibilities, from prosperity in many developed markets to chaos if the conflict in the Middle East widens. Fixed-income markets tend to focus on risks more than on the potential for windfall profits that the stock market cherishes.
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