Business

1. Larry Fink’s retirement plan (no, not his)
2. Federal layoffs bite
3. A new weapons bank
4. Dimon unloads on ISS
5. Treasury Secretary makes the trust-us case
6. Olympic billions under scrutiny

Hi, and welcome back to Semafor Business, where we’re debuting our new look.

A weird thing about business is that CEOs get report cards every three months about how well they’re preparing their companies for a distant future. They complain that “short-termism” blinds shareholders, who demand immediate profits without seeing the vision. Those shareholders complain that “long-termism” lets CEOs waste their money to chase riches that may never materialize. It’s a temporal trap.

Right now, the CEO in that scenario is President Donald Trump, who has embarked on a wholesale transformation of America’s business plan and balance sheet. He’s asking corporate America and financial markets to bear with him until the tariffs pay off, manufacturing returns, and the US owns Ukraine’s rare earth minerals. The “period of transition” Trump is warning about is the trough of the J curve.

Executives are unnerved, to say the least. But they are professionally primed for the argument Trump is making: short-term pain for long-term gain. Trust us. We have a strategic plan.

I heard it again and again this week in Washington, where I was interviewing some of those CEOs on stage and cajoling others for a readout of their private conversations with Trump, who spoke at an event with the Business Roundtable, a group of blue-chip executives.

“Every CEO I talk to, we’re starting to talk about a more fearful economy right now,” BlackRock chief executive Larry Fink told me. “But I do believe this is going to be more short-term, once we understand the policies, once we become more accustomed to it.”

In short, the business community likes Trump’s strategy, but is iffy on the tactics (tariffs), nervous about the up-front costs (a potential recession), and skeptical of his ability to execute.

For the moment, Trump has their silence. I asked one Fortune 50 boss this week what would change that: “another 5 points” off the S&P 500, which is down 8% from its February highs.

In this edition: Scott Bessent at the BRT; Jamie Dimon gets some things off his chest; and a new way to finance global rearmament.

BlackRock wants Americans to bet on America

US officials should revisit the idea of private investment accounts to supplement Social Security, BlackRock CEO Larry Fink said.

“We have a plan called Social Security that doesn’t grow with the economy,” Fink told me at BlackRock’s retirement summit in Washington on Wednesday. “You’re detached from the economy, and you don’t feel like you’re winning.”

Social Security funds are invested in US Treasury bonds, which have offered paltry returns in recent decades while the stock market has soared. Privatizing it — though Fink bristled at the word — has been a political hot button for decades; the last president to try, George W. Bush, saw his second-term agenda wrecked in part by the fallout.

“I think more Americans can be a little more hopeful today with their retirement savings than just getting that bond payment,” said Fink, a bond guy at heart.

Read on for Fink’s outlook for the economy. →

Federal layoffs start to bite

Today is the deadline for federal agencies to submit their layoff and budget plans to DOGE, as the effects of widespread firings of federal workers are already showing up in the economy.

About 250,000 federal employees have been laid off since DOGE began its cuts, and a potential government shutdown this week would furlough thousands more. Unemployment claims in Washington jumped 25% in a week.

“This is already having distinct impacts on our economy, on our income taxes, on our unemployment rate,” Maryland Gov. Wes Moore told Semafor Editor-in-Chief Ben Smith this week. The state has 160,000 federal workers and its economy is powered by “the feds, the eds, and the meds,” he said — referring to government jobs, and universities and hospital systems that rely on federal funding.

United Airlines CEO Scott Kirby said the company’s government business had taken a 50% hit, and laid-off workers have less to spend, stoking concerns of a recession. “Our customers continue to report that their financial situation has worsened,” Dollar General’s CEO said on an investor call Thursday.

— Rohan Goswami

Financing the world’s rearmament

A new proposed international development bank is talking to US and European governments about backstopping the massive increase in security spending that Donald Trump wants to see.

The Defense, Security, and Resilience Bank wants to raise $100 billion from Western governments to make loan guarantees to countries and defense contractors, said Rob Murray, a former NATO official who is heading the initiative. The plan would “open the floodgates for private money to get into the defense sector at a scale we haven’t seen before,” Murray told Semafor.

The world is rearming at a pace not seen since the end of World War II. Last week, Germany said it would borrow hundreds of billions of euros from the bond market for a military buildup. Germany has a AAA credit rating, but other countries bulking up their defenses don’t — Turkey, for example, is junk-rated — and would otherwise struggle to pay for it.

Poland, which currently holds the rotating presidency of the Council of the European Union, supports the idea and is aiming to pitch a concrete proposal to the bloc countries’ finance ministers at their meeting next month. US companies would be the biggest beneficiary of the bank, Murray added, sounding like he knows exactly who he needs to convince: He says he pitched the idea to Trump at a dinner at Mar-a-Lago in January and that the president was “supportive.”

Dimon takes ISS, Glass Lewis to task

Jamie Dimon sharply criticized proxy advisory firms, the little-known shops that wield huge influence in corporate boardrooms. In an interview with Semafor Wednesday, the JPMorgan chief said Institutional Shareholder Services and its smaller rivals are “incompetent” and contributing to a regulatory environment that is “driving companies out of the public market.”

Proxy advisers have long been the target of corporate ire, though never quite as publicly or harshly as this: “Anyone who gives them money — shame on you,” he told Semafor’s Gina Chon at BlackRock’s retirement summit. The firms “should be gone and dead and done with.” They are also in the crosshairs of Republican congressional members and Washington regulators.

“Our clients, as sophisticated institutional investors, are the best judge of the value and quality of our work,” an ISS spokesperson said. Glass Lewis didn’t respond.

Dimon also weighed in on corporate America’s stepback from ESG policies. “I’m not in favor of wasting shareholder money with virtue signaling,” he said.

— Rohan Goswami

Read more for Rohan’s view on what the future holds for proxy advisory firms. →

Treasury Secretary makes case for patience

Treasury Secretary Scott Bessent met privately with CEOs in Washington yesterday, Semafor scooped. In a Q&A with Goldman Sachs CEO David Solomon, Bessent stressed the Trump administration’s plans to put large chunks of the economy into private hands, in part by reducing regulations on banks and allowing them to finance projects and services currently paid for out of the public purse. “We’re going to de-lever the government and re-lever the private sector,” he told the room, according to one attendee’s notes.

In a whistle-stop tour over the past week, Bessent has tried to reassure the business and financial community as markets continue to slide, while also starting to knit a more cohesive version of Trump’s economic policy that have so far looked slapdash.

Olympic ad bonanza under scrutiny

A leading candidate to run the International Olympic Committee wants to upend the Games’ sponsorship and media deals — the crown jewel of corporate advertising. Juan Antonio Samaranch told Semafor’s Andrew Edgecliffe-Johnson that the IOC’s marketing program, which governs more than $2 billion in sponsorships from brands including Alibaba, Coca-Cola, and Samsung, “needs immediate attention.” He wants to allow a wider array of companies to join. “We have to be an extraordinarily efficient business machine to raise the money to be able to do what we do.”

The Spanish investment banker, whose father ran the IOC in the 1980s and 1990s, is also pitching private equity firms on a $1 billion fund through which the IOC could help them spot undermonetized sports to invest in. Anyone for Greco-Roman wrestling on Netflix?

➚ BUY: Tan. Intel finally has a new CEO. Former board member Lip-Bu Tan inherits a battered national champion at the center of the chip race. Shareholders are pleased, but Tan has a more important constituency to tend to — the US government, which is keeping close tabs.

➘ SELL: Green. The US dollar has lost 5% since Trump’s inauguration, measured against a basket of global currencies. A weak dollar helps Trump’s trade agenda by encouraging Americans to buy domestic goods and making exports more competitive.

Markets

• Pushing boundaries: Investors are placing bets on Russian debt, Bloomberg reports, gambling on a ceasefire windfall. But Moscow looks poised to reject any temporary halt in the fighting.

Companies & Deals

• On the rocks: Trump vowed to respond to EU’s retaliatory tariffs with more tariffs — this time, a 200% levy on Eurozone alcohol. Shares of AB InBev and Moët owner LVMH fell Thursday morning.
• Dig, baby, dig: Miners are hoping for an American renaissance. The FT reports that Trump will sign an executive order to reform mine permitting. Freeport-McMoran and Barrick Gold shares rose.