Monday's business headlines
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Breakfast Business with Enterprise Ireland on Newstalk.
Good morning. You're listening to Breakfast Business with Susan Hayes-Cullerton in for Joe Lynham today. And coming up this morning, we will be talking promotional pricing because, of course, it is Cyber Monday. European top 30 business school rankings and all of your market news. Now, I do hope that you're settling well and happy into this week. I was actually in Liscannor myself for the weekend and you know, there is really something about the fresh air, the ruggedness of the Cliffs of Moher, the music, the food and of course, the people of North Clare. So, I hope you had a weekend where you have that topped up feeling as you head into the week and if not, well, I'm right here beside you to ease you into the first week of December.
So, Let's get straight into it and look at some of the stories in the paper this morning and indeed of the things that happened over the weekend with Russ Mould from AJ Bell. Good morning, Russ.
Morning to you, Susan. Hope you're well. Sound as if you are.
What business news is highlighted for Cyber Monday?
I am indeed. Thank you. Well, we'll start off, first of all, with a pretty decisive answer to the referendum in Switzerland yesterday, which had a proposal to impose a 50% inheritance tax levy on estates and transfers over 50 million Swiss francs. That works out about roughly 53 million euro. What happened in Switzerland?
So this was a proposal from the Social Democrats, left-leaning, to basically set up a climate change fund using inheritance tax on some of Switzerland's well-heeled residents. And the Swiss voted 78% to say thank you, but no thank you. So I guess what they've done there is prioritise what Switzerland is famous for, which is a haven for indeed the well-heeled, because that's ultimately where the country has made its money for pretty much time immemorial.
But you do say the well-heeled residents. I mean, the reality is here, this wasn't about necessarily only taxing people who live there, but the opportunity cost, if I could take that economic term, about people who wouldn't move there if such a deal had been or such a proposal had been accepted.
Correct. And this is one of the reasons why, again, it gets back to what Switzerland has perceived as a haven. It's one of the reasons why the Swiss franc is probably the world's strongest currency, why the economy is pretty stable, and why times of duress or even just times of governments rattling down the back of the sofa for cash, as a lot of them are right now, people tend to head to Switzerland. And in the end, this comes back to Walter Wriston's law of capital. Former chairman of Citibank, money goes where it feels welcome and well cared for. Capital goes, and that includes people and ideas as well as money. And generally, low taxes attract capital, higher taxes, not so much.
But it's not like this agreement or the result was decisive, but the discussion wasn't necessarily. I mean, 43% of the population came out to vote on this. It was contentious, wasn't it? I mean, this wasn't easily decided, right?
No, and there'll be all of your listeners absolutely tearing their hair out thinking that, you know, again, there's been a short-term prioritization of capital over climate change. And a lot of very, very frustrated people in Switzerland and beyond. Of that, there is absolutely no doubt at all.
Okay, well, let's move then into other parts of Europe because this is a rare development, Ross, but in the ranks of the world's 20 best performing stock markets this year, every second index is European, including Ireland, and we'll get to that. But this has only ever been achieved three times before, 2004, 2015 and 2023. And that's in data going back to the creation of the euro area. Now, it does seem that the US gets all of the good press when it comes to stock market returns. So what has been simmering this year?
I think it's a really good question. I think the thing with the U.S. is Warren Buffett, the master investor, once said, high expectations ultimately forge their own anchor.
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