The daily business briefing: January 12, 2017
Trump says he won't divest from business empire, prosecutors charge 6 VW executives, and more
Trump to hand businesses over to sons, ethics chief not impressed
President-elect Donald Trump announced Wednesday that he would not divest from his business empire after he is sworn in, but would turn over management to his adult sons. "They're not going to discuss it with me," Trump said at a long-awaited news conference. He also said his company would not strike any new deals abroad while he's in office. The head of the Office of Government Ethics, Walter Shaub, criticized Trump's precedent-breaking plan to continue profiting from his business while president as "wholly inadequate," saying that it is "meaningless from a conflict of interest perspective" to stop running the business without selling and putting assets in a blind trust. "We can't risk the perception that government leaders would use their official positions for professional profit," he said.
Prosecutors charge 6 VW executives over emissions scandal
Federal prosecutors on Wednesday announced criminal charges against six Volkswagen executives over the German automaker's diesel emissions test cheating scandal. The defendants include a former head of development for the VW brand and a former head of engine development. One of the executives, Oliver Schmidt, was arrested in Florida last week. The others are believed to be in Germany. The news came as the company struck a plea deal to pay $4.3 billion in criminal and civil penalties, bringing the total cost of settlements with car owners and the government to $20 billion.
Drug shares fall after Trump criticizes pharmaceutical prices
Drug stocks plunged on Wednesday after President-elect Donald Trump said that the pharmaceutical industry is "getting away with murder" by charging the government too much for drugs. Trump vowed to change the way the country bids on drugs. In the past, he has called for ending a policy prohibiting the government from negotiating lower prices from drug companies. The iShares Nasdaq Biotech ETF ended down 3 percent, its biggest one-day dive in three months. "When somebody that high profile says something that negative, people do not want to invest in it," said Brad Loncar, manager of the Loncar Cancer Immunotherapy ETF.
Tillerson breaks with Trump on key issues, including trade
President-elect Donald Trump's nominee for secretary of state, former ExxonMobil CEO Rex Tillerson, broke with Trump on several key issues during his Senate Foreign Relations Committee confirmation hearing. Tillerson said he did not oppose the Trans-Pacific Partnership, a free trade agreement Trump has condemned, although Tillerson said he questioned "whether the agreement that was negotiated serves all of America's interests the best." Tillerson also called Russia's Ukraine invasion "illegal," which Trump has not done. Democrats criticized Tillerson for ExxonMobil's Russia ties, and Sen. Marco Rubio (R-Fla.) criticized him for not condemning Russia, China, Saudi Arabia, and the Philippines for their human rights records.
Trump says he turned down $2 billion Dubai deal over the weekend
President-elect Donald Trump said Wednesday that he had turned down a $2 billion deal with DAMAC Properties, a Dubai-based developer, over the weekend. "I didn't have to turn it down because as you know I have a no conflict situation because I'm president," Trump said. "It's a nice thing to have." Trump said the offer came from DAMAC Properties chairman Hussain Sajwani, whom the incoming president called "a very, very, very amazing man." A DAMAC spokesperson confirmed the discussions, and Trump's decision to turn down "a variety of different property deals."