U.S. President Donald Trump's administration likes to throw its weight around in dealings with Corporate America, as the CEOs of Intel, Nvidia and U.S. Steel can attest.
Now the biggest players in the asset management industry will learn more about their own freedom of action after the U.S. Treasury on July 2 named them to run money for the new "Trump accounts." Under the savings program the government will deposit $1,000, meant as seed money, into an investment account for each U.S. newborn.
Initially, all contributions to the program will be invested in the State Street SPDR Portfolio S&P 500 ETF <SPYM.P> with other ETFs the firm and rivals BlackRock and Vanguard to be eligible later.
On the surface the three firms look like obvious selections. Known as the "Big 3," they dominate their industry with low-cost index funds and run a collective $33 trillion.
But deals with Trump often go beyond dollars and cents, as the semiconductor and steelmaker firms found out and as the fund firms know via their records on environmental, social and governance (ESG) issues.
You can read what the Treasury has to say on this topic in my column this week by clicking the button below.
