Greetings,

The tense geopolitical environment of 2026 has corporate tax leaders calling on global authorities to focus less on a global minimum tax and more on improving dispute resolutions in the fractured international tax landscape. More on that below.

Also in this edition: 

• Bond traders test Fed pivot with inflation data
• Warsh's Fed guidance shift may lift borrowing costs
• Cutting benefits may not produce significant savings
• Private-credit fund redemption requests surge to $12B in Q2

Tax professionals are urging the OECD to focus on resolving specific tax issues stemming from global discord rather than pursuing broad multilateral tax reforms. They highlight the urgent need for improved dispute resolution amid challenges such as US tariffs, the Iran war, and debates over the global minimum tax.

Bond traders are closely watching this week's personal spending data after Federal Reserve Chairman Kevin Warsh's recent comments on restoring price stability prompted a shift toward a more hawkish stance. Short-term Treasury yields surged last week as traders priced in a potential rate hike in 2026, following Warsh's first press conference.

Investors have warned that Federal Reserve Chair Kevin Warsh's move to strip back forward guidance could increase Treasury volatility and push US borrowing costs higher by forcing markets to price more uncertainty. Warsh declined to submit his own dot plot and signaled further changes to Fed communications, a shift that may raise risk premia while giving traders less advance warning on future rate moves.

The Conference Board's Leading Economic Index increased 0.5% in May, marking the second consecutive month of growth. The index is still down 1.9% year over year, but the increase suggests a positive outlook for the economy, according to the Conference Board.

The S&P 500 is approaching new records because of rising corporate earnings, solid economic data and falling oil prices, but investors are wary. Risks include stretched valuations, potential interest-rate increases by the Federal Reserve and the sustainability of artificial-intelligence-driven growth. Net equity issuance has also increased, raising concerns about market stability.

Companies such as Deloitte and Zoom are reducing employee benefits, especially parental leave, to counter rising healthcare costs. Rich Fuerstenberg of Mercer warns that such cuts may not yield substantial savings and could harm employee morale. Fuerstenberg suggests companies evaluate the true value and savings of benefits cuts, considering state mandates and productivity costs, before taking action.

The model of launching public companies to buy cryptocurrency is faltering, with firms using special-purpose acquisition companies facing investor pressure amid a declining stock market. ReserveOne, a cryptocurrency asset manager associated with former Commerce Secretary Wilbur Ross, is among the companies affected.

Private-credit funds are facing increased withdrawal requests from individual investors, with $12 billion in redemptions requested in the second quarter, up from $7.7 billion in the first quarter, according to Robert A. Stanger & Co. The trend has caused private-credit fund managers' stocks to underperform, and there are concerns that prolonged withdrawals could force asset sales.

President Donald Trump is introducing new tariffs after the Supreme Court ruled his previous global tariffs illegal. The administration is using Section 301 of the Trade Act of 1974 to justify these tariffs, focusing on forced labor and excess industrial capacity, and while countries such as the Philippines and South Africa might benefit from lower tariffs, countries such as Singapore face higher rates. The impact on Canada, Mexico, the EU and China remains uncertain as trade negotiations continue.