Trump said he “made a deal with China”.
More like a shakedown after he blinked and China got everything it could have asked for.
Welcome to Talking Business, a podcast produced in Melbourne Australia. The podcast is available on the Acast site, my own website, the Apple Podcast store or wherever you go to get your podcasts. Or you can get it at the Business Acumen website at www.businessacumen.biz.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com.
I am Leon Gettler. My job is to review and monitor the week’s news in business, finance and economics. I bring it all to you, every week.
This is episode number 14 in our series for 2025 and today’s date is Friday May 16.
First, I’ll be talking to Gadi Buch, founder of Promeet. It’s a company that is revolutionizing the creator economy by developing a platform that allows users to monetize their online meetings and streams using blockchain technology. The company aims to eliminate third-party intermediaries, reduce fees, and give users more control over their earnings. Promeet offers a simple and frictionless experience for both content creators and viewers. With a competitive 5% fee on transactions, Promeet provides a more affordable alternative to traditional platforms.
And I’ll be talking to RMIT economist Sinclair Davidson about Australia’s economic challenges with tax reform and productivity ahead post-election
But first, let’s talk to Gadi Buch
So what’s happening in the news?
After a weekend of negotiating in Geneva, the United States and China said Monday they reached an agreement to temporarily reduce the punishing tariffs they have imposed on each other in an attempt to defuse the trade war threatening the world’s two largest economies. In a joint statement, the countries said they would suspend their respective tariffs for 90 days while they negotiate. Under the agreement, the United States would reduce the tariff on Chinese imports to 30% from its current 145%, while China would lower its import duty on American goods to 10% from 125%. The agreement breaks an impasse that had brought trade between China and the United States to a halt. Though the agreement is limited to a 90-day period, its implications are far-reaching—providing space for businesses to regroup, and for markets to reprice risk and reward in real time. Analysts say the apparent upbeat move in the Swiss city of Geneva stands to give both powers interim political relief at home without appearing weak on the trade war battlefront. Matteo Giovannini, a non-resident associate fellow at the Centre for China and Globalisation, said: “The US side is under political pressure to show wins. China, on the other hand, sees negotiations not as a singular outcome but as a strategic process to manage bilateral competition, economic resilience, and long-term development goals.” Others were more cynical about the deal. “While we remain sceptical that anything of substance could be agreed upon after only two days of trade talks, it’s clear that both sides are looking to de-escalate the situation,” Win Thin, global head of markets strategy at Brown Brothers Harriman & Co wrote in a note. One overriding question has significant implications for the negotiations to come: did Beijing or Washington flinch first? Trump on Monday claimed victory, saying he had engineered a “total reset” with China. Trump struck a conciliatory tone on Monday—a contrast to his campaign rhetoric. “We’re not looking to hurt China,” he said at the White House. That contrasted with his rhetoric shortly before last year’s election when he mentioned China 26 times in a Nov. 4 rally in Pittsburgh. “We’re going to tariff the hell out of them,” he said at the time. Meanwhile Hu Xijin, the former editor of national Communist party tabloid the Global Times, said on social media that the deal was “a great victory for China”. “The US has chickened out,” said one popular Chinese social media post of the deal. Economists agreed that the US might have overplayed its hand by raising the tariffs too quickly and too high. “The US blinked first,” said Alicia García-Herrero, chief Asia-Pacific economist at French investment bank Natixis. “It thought it could raise tariffs almost infinitely without being hurt, but that hasn’t been proven right.” When President Donald Trump launched his trade war on the world, he issued a stern warning: “Do not retaliate and you will be rewarded.” China ignored the warning. It was rewarded anyway. So this week, Trump largely suspended his trade war in return for nothing but promises of ongoing discussions. There is a lesson here for everybody Trump threatens, whether countries or businesses or universities. Standing up to Trump does not mean that you win. But giving in guarantees that you lose.
In an important piece of news that raises a bunch of questions, the Trump administration plans to accept a luxury Boeing 747-8 plane as a donation from the Qatari royal family. It will be upgraded to serve as Air Force One, in possibly the biggest foreign gift ever received by the U.S. government. The plane will then be donated to President Trump’s presidential library when he leaves office. Now all this, raises questions from Democrat lawmakers and good government groups. They have raised concerns about conflicts of interest and substantial ethical issues given the immense value of the lavishly appointed plane and Mr. Trump’s intention to use it after he leaves office. Sold new, a commercial Boeing 747-8 costs in the range of $400 million. Which would make Donald Trump a stack of money when he leaves office. Critics didn’t mince words about what they saw as a clear violation of federal law. The Qataris have an expansive array of business interests tied to the U.S., including energy projects and investments. Good-government advocates also noted that Trump’s family business just announced that it will build a new gold resort in Qatar, which will be developed in part by a state-owned business. “The corruption is brazen,” Senator Adam Schiff Democrat of California, wrote on X. “Nothing says ‘America First’ like Air Force One, brought to you by Qatar,” added Senator Chuck Schumer of New York, the minority leader. “It’s not just bribery, it’s premium foreign influence with extra legroom.” President Trump angrily brushed off ethical concerns about accepting a $400 million luxury jet from Qatar to be used as a new Air Force One, saying only someone “stupid” would turn down such an offer. Mr. Trump said that the gift from Qatar will be to the U.S. Department of Defense — and not him personally — and he said he would not use it after he left office.
And Australia’s new Opposition leader Sussan Ley has vowed there’ll be no climate war in the Coalition as she followed the Nationals by putting the Liberal Party’s commitment to net zero emissions by 20250 under review, promising robust policy processes. Ley said there will be no “captain’s call” on policy including climate and energy, although she did commit to a new tax and economic narrative. Ley made history by becoming the first female leader of the Liberal Party. How long she lasts as leader of the party that’s divided remains to be seen. Ley became the first female leader of the Liberal Party in its history after pipping former shadow treasurer Angus Taylor by 29 votes to 25 to replace the vanquished Peter Dutton.
Over on the Australian government side, dumped industry minister Ed Husic has revealed that Australians have endorsed a second-term Labor government with no plan for reviving living standards. Ed Husic has exposed how Treasurer Jim Chalmers rebuffed the dumped industry minister’s first-term push for business tax incentives to drive a technology-based upswing in manufacturing capital expenditure. “My argument has been that we need to have a growth agenda.That’s how Husic began his brief but devastating critique of a Labor government that the Australian people have just returned to office with a thumping majority. That is, do more than throw more borrowed money at voters to cushion the cost of living squeeze while not dealing with the underlying problems of falling productivity, a decade of budget deficits and a world upended by Donald Trump.” Husic’s call for Labor to “burn through timidity that has shackled us in the first term” goes straight to Anthony Albanese and Chalmers. “I wasn’t just talking about company tax,” Husic said on the ABC Insiders program on Sunday morning. “I also stressed the need for investment allowances to renew machinery to see capex grow, to have a productivity burst as well, because it is good to have strong businesses, great jobs and a strong economy that is well fuelled into the future. That is something long term, I think [that] does need to be considered, We need to see business be able to invest and free up capital …But I’ll be very careful about how much I say, if you don’t mind, because I’ve got a cabinet colleague in the form of the treasurer who manages the tax revenues”. Chalmers and Labor have been in denial about the weakness of business investment, which has been held up by spending on renewable energy and data centres. The budget papers describe business investment as being at “decade highs”. But the Business Council of Australia notes that business investment “slumped to a 30-year low as a share of GDP in 2022 and has barely recovered”.
Former competition regulator head Rod Sims has urged the Albanese government to campaign on a carbon price and tax reforms at the 2028 election, while tapping its newly won mandate this term to boost productivity, project approvals and fix a wayward electricity system. Mr Sims, an expert adviser to Treasury’s Competition Task Force, has issued an eight-part plan for reform after Labor’s thumping election win a week ago. Both Labor and the Coalition were criticised for a lack of policy ambition during the campaign, amid frustration tax reform was discarded from the agenda. Mr Sims argues taking a reworked carbon price to the next election would boost productivity and help finance true tax reform should Anthony Albanese win a third straight term in office. “What about tax reform,” Mr Sims said. “It is true that the government does not have a mandate for this. It should go to the 2028 election seeking such a mandate. But serious tax reform needs to be paid for. The best way to do this is via a price on carbon to compensate for the damage fossil fuels do to our environment. The proceeds cannot just compensate households, they can also finance true tax reform and make it saleable to the electorate. Those who want true tax reform should get behind a price on carbon. The boost to productivity will be huge.” Treasurer Jim Chalmers has signalled no quick fixes to address productivity reforms. After initially pledging Labor’s second term will focus on productivity without forgetting inflation, the Treasurer told Nine newspapers a third term would be needed to deliver progress on productivity. Mr Sims and economist Ross Garnaut first proposed a carbon tax a year ago in a bid to raise hundreds of billions of dollars, but Labor and the Coalition rebuffed the idea in a rare bipartisan move on climate action. Australia is in the midst of its worst labour productivity levels on record, falling 1.2% in the last year with average productivity growth over the past decade hitting its lowest levels in 60 years. The ex-competition tsar said action must be taken. “The government does not lack a mandate for reforms to boost productivity. But it now needs to act on its mandate,” Mr Sims said. Moves to drive productivity including harnessing digital technology, innovation, skilled workforce, and the net zero transformation must now be acted on to deliver tangible benefits to the economy, he said.
ANZ’s new boss Nuno Matos has his work cut out for him. A Portuguese banker who was a contender for HSBC’s top job after a stint running that bank’s wealth and personal banking operation from Hong Kong, takes on the ANZ job earlier than originally intended. The long-time banker, who made a brief foray into teaching at the Catholic University of Portugal, had originally been slated to kick off from July 3. But events at ANZ, including a review of its markets business and a $250 million penalty from the prudential regulator, led the bank to bring forward the leadership handover to May 12, One of the new CEO’s first meetings was with the bank’s non-financial risk committee. That meeting is a clear signal from ANZ it will prioritise the area after the Australian Prudential Regulation Authority warned the bank was falling flat in stopping bad behaviour from its bankers which included manipulation of bond markets, massaging trading data to win government contracts, work meetings at Sydney strip clubs and boozing on the trading floor. Mr Matos will also face tests in the coming months, with the Australian Securities & Investments Commission looking at how to how to proceed with an investigation into ANZ over allegations its traders manipulated a $14bn government bond market. This could see ANZ face court, in what may resemble a re-run of ASIC’s case years earlier against the bank over allegations its traders rigged the Bank Bill Swap Rate.
Australian National University splurged $185,860 on a trip to Davos in January 2023 – despite booking a $117 million deficit for the previous year – for six staff members, including its two most senior leaders, Julie Bishop and Brian Schmidt, and star recruit Genevieve Bell. Not a good look. The lavish trip included a $78,500 party featuring Australian wine for 80 guests – just shy of $1000 a head. The trip included six members of ANU staff: Bishop, the university chancellor; Schmidt who was then vice chancellor; Bell who was at the time the director of the School of Cybernetics but took up the role as vice chancellor the following January; along with the head of the communications and engagement team, a communications manager and the head of “principal gifts” – ANU’s philanthropic arm. The most extravagant expense was an ANU reception and “networking event” called Australia in Davos attended by 80 people at a cost of $78,500
And that’s it for this week. And next week, I’ll be talking to Iain Salteri who developed the KttiPay app which targets Gen Z and Millennials, acknowledging their daily encounters with group spending. The app, loaded with customizable features, simplifies the process by allowing users to create separate ‘Ktties’ for different purposes. KttiPay issues Visa debit cards directly linked to each Ktti, facilitating seamless payments and expense tracking. Whether for a casual dinner, a weekend getaway, or a celebration. Kttipay enables group members to contribute directly to the app using digital wallets like Apple Pay or Google Pay. A Digital Visa Debit Card for the specific Ktti is then issued for group-related expenses
And I’ll be talking to independent economist Nicholas Gruen about his innovative idea to set up a citizens forum to resolve the US-Canada tariff war which could potentially be extended to Australia.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com
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Looking forward to the next episode of Talking Business.
