TY - JOUR T1 - “Fake” Tariff News: <em>Is Corporate America Concerned with Trade Wars?</em> JF - The Journal of Investing SP - 122 LP - 131 DO - 10.3905/joi.2019.1.088 VL - 28 IS - 5 AU - Julia Klevak AU - Joshua Livnat AU - Duo Pei AU - Kate Suslava Y1 - 2019/07/31 UR - https://pm-research.com/content/28/5/122.abstract N2 - The effect a trade war would have on corporate America is a widely disputed hot topic. On one hand, the trade dispute may discourage abusive trade practices by foreign companies; on the other, it may hurt American exporters, raise costs for manufacturers, and interrupt companies’ supply chains. The authors shed some light on this question by examining the language of earnings call transcripts in the April–August 2018 period, the earliest voluntary disclosure by US companies to communicate their views on this topic to investors. They find that the tone of the conference calls in which companies mention trade tariffs is more negative than a matched control sample. They also find that investors do not share in the pessimism expressed by call participants, and actually reward tariff talk with higher but more volatile stock returns.TOPICS: Fundamental equity analysis, legal/regulatory/public policy, performance measurement ER -