Good afternoon,

Congratulations on making it halfway through the work week!

This is by no means a political newsletter. But regardless of your politics, there's no question President Donald Trump has taken a much more hands-on approach with a range of US institutions to achieve his policy goals, including big business and higher education.

These interventions are making some folks nervous, while others are cheering them on. In any case, it will be interesting to see what comes of them. 

Also in this edition:

• Home Depot CFO says some prices will rise due to tariffs 📈
• Corporate bond spreads hit 25-year low 📉
• Wyoming issues a stablecoin 🪙
• CEO transitions are pricey 💰💰💰
• People are worried about AI job losses 😟

President Donald Trump is adopting an unprecedented hands-on approach to corporate America, using the power of the federal government to intervene directly in business decisions for economic and foreign policy aims. Recent actions include seeking a share of revenue from AI chip sales to China by major tech companies and pursuing government equity stakes in critical industries. While these moves are intended to strengthen national security and bolster domestic industries, they mark a significant departure from traditional US free-market principles and have left investors and policymakers navigating new and uncertain territory.

Investors are raising concerns about a period of "fiscal dominance," in which central banks are pressured to keep interest rates low to manage soaring government debt. The trend is most evident in the US, where President Donald Trump has urged the Federal Reserve to cut rates, but governments in the UK and Japan are also putting pressure on their central banks.

Home Depot plans to implement modest price increases on certain items due to higher tariffs, a shift from its previous stance of avoiding price hikes through diversified sourcing. CFO Richard McPhail says that the price changes will be limited in scope and not widespread, noting that the company's overall pricing strategy remains unchanged.

Spreads on high-quality US corporate bonds have narrowed to 75 basis points over Treasurys, matching levels last seen in 1998. The drop in spreads, tracked by the ICE BofA US Corporate Index, highlights a significant shift in the corporate bond market, as robust demand has compressed the risk premium investors require over government bonds.

Wyoming has introduced its own stablecoin, the Frontier Stable Token, becoming the first state to do so. The token, backed by dollars and short-term Treasurys, aims to allow for instant transactions. The launch follows the recent signing of a federal stablecoin regulation bill by President Donald Trump.

CEO transitions can impose significant costs on companies, often exceeding publicly disclosed figures, according to a Bloomberg News analysis. Starbucks, for example, spent $130 million on its 2024 CEO change from Laxman Narasimhan to Brian Niccol, including $90 million in "make-whole" payments to Niccol. Legal, advisory and search firm expenses can also quickly reach millions, while unplanned transitions may also depress company morale and investor confidence.

Seventy-one percent of Americans are worried that AI could result in the permanent loss of jobs for many workers, according to a recent Reuters/Ipsos poll. Despite the current low unemployment rate, there is significant anxiety about AI fundamentally changing the job landscape and displacing large numbers of employees across various sectors.

Chamath Palihapitiya is returning to the SPAC market nearly three years after stepping back, launching a $250 million IPO for American Exceptionalism Acquisition Corp. Amid the SPAC boom at the start of the decade, the former Facebook executive raised money for 10 blank check firms before several of his SPACs folded without completing a merger. The SPAC King name was tied more to volume than success. Of the six blank check firms that completed mergers, just one has generated returns for investors. However, we must give him some points for honesty this time around. In a letter, Palihapitiya said retail investors should not participate unless they can afford to lose their entire investment.

If you're a daily reader, you've likely noticed a change in the look and content of SmartBrief for CFOs. We're trying some new things at SmartBrief, and this newsletter was selected for experimentation.

Look for more changes in the future, and please let us know if you like them, hate them or are totally indifferent.

We'd also like some feedback on content. Please let us know if there's content you'd like to see but aren't seeing, or if you're seeing content that isn't useful or interesting. Thank you to those of you who reached out yesterday.

You can reach us at matt.reitz@futurenet.com.