BREAKING NEWS Court rules 1st federal execution in 17 years can proceed Full Story

Tax cut will drive innovation, ex-Home Depot CEO says

One of Corporate America's biggest proponents of the Republican tax cut says companies will spend their savings on th...

Posted: May 16, 2018 6:59 PM
Updated: May 16, 2018 6:59 PM

One of Corporate America's biggest proponents of the Republican tax cut says companies will spend their savings on themselves.

"In today's world you either innovate or evaporate," Bob Nardelli, founder and CEO of the investment and advisory company XLR-8, said Wednesday on CNNMoney's "Markets Now."

Nardelli, the former CEO of Chrysler and Home Depot and a former executive at GE, said he expects companies to "significantly" increase their capital spending by as much as 30% because of the tax breaks.

He noted that companies produced strong earnings in the first quarter, and many are reinvesting in their own businesses.

"The corporations are taking great advantage of this new tax program," he said.

Nardelli was critical, however, of Corporate America's initial rush to use their tax savings on stock buybacks. He noted that buybacks are unpopular with the public, and he believes that at least a quarter of tax savings should have gone to improve infrastructure.

"Overall, it did well, though there could have been some level of refinement," Nardelli said. "We worked expeditiously to get it done. It's done a good job."

President Donald Trump's tariffs may have eaten a bit into corporate profits, but Nardelli praised them nonetheless. He said they have encouraged US manufacturers to buy more American steel and "create more patriotism," calling Trump "a savvy negotiator."

Corporations have mostly fought the tariffs. They say there is not enough American steel or aluminum to fulfill their needs, and tariffs force them to pay more for imports.

Nardelli also weighed in on his former companies. He said that Home Depot had a decent quarter, despite slow sales because of the harsh winter.

But he chastised GE CEO John Flannery for moving too slowly to turn the company around. Nardelli said he wants to see "more bold moves" and more decisive, aggressive action to streamline the company and sell underperforming assets.

"I went through this at Chrysler, and time is not your friend," Nardelli said. "I love that company; I'm pulling for them. I would like to see them move more quickly. There can be no slow maybes."

He joined CNNMoney anchor Maggie Lake on the program, which streams live from the floor of the New York Stock Exchange every Wednesday at 12:45 p.m. ET.

Related: Watch 'Markets Now' here every Wednesday at 12:45 p.m. ET

"Markets Now" is hosted by Lake and CNNMoney editor-at-large Richard Quest. You can watch at your desk or on your phone or tablet at CNNMoney.com/MarketsNow.

Each episode features incisive commentary from investors and experts on the biggest news of the day. Previous guests have included crypto bull Mike Novogratz, BlackRock strategist Kate Moore, hedge fund manager Kyle Bass and others.

Can't watch at 12:45 p.m. ET? Interview highlights will be available online and through the Markets Now newsletter, delivered to your inbox every afternoon.

Terre Haute
Scattered Clouds
77° wxIcon
Hi: 83° Lo: 59°
Feels Like: 79°
Robinson
Scattered Clouds
74° wxIcon
Hi: 80° Lo: 58°
Feels Like: 74°
Indianapolis
Broken Clouds
77° wxIcon
Hi: 80° Lo: 62°
Feels Like: 79°
Rockville
Clear
71° wxIcon
Hi: 83° Lo: 58°
Feels Like: 71°
Casey
Scattered Clouds
75° wxIcon
Hi: 81° Lo: 59°
Feels Like: 75°
Brazil
Scattered Clouds
77° wxIcon
Hi: 82° Lo: 58°
Feels Like: 79°
Marshall
Scattered Clouds
77° wxIcon
Hi: 83° Lo: 59°
Feels Like: 79°
Low chance of storms tonight with clearing conditions
WTHI Planner
WTHI Temps
WTHI Radar

Latest Video

Image

Sunday Morning Forecast Update

Image

Saturday Morning Forecast Update

Image

Ryan Lieberman

Image

Zoe Stewart

Image

WVFCA Friday Night Lights

Image

Tim Hayes

Image

Keeping your house cooler without running the A.C. all day

Image

Several local groups partner to help you learn new job skills

Image

Duke Energy says scammers have a new tactic to steal your information, and it involves refund checks

Image

Richland County sees an increase in young people contracting COVID-19

WTHI Events

 

Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Confirmed Cases: 154094

Reported Deaths: 7369
CountyConfirmedDeaths
Cook951384711
Lake10318428
DuPage9641485
Kane8078281
Will7223325
Winnebago3156105
St. Clair2265144
McHenry2248102
Kankakee141466
Unassigned1180201
Rock Island116930
Madison116770
Kendall104823
Champaign103817
Peoria64430
DeKalb63720
Boone63521
Sangamon51933
Jackson35119
McLean31515
Randolph3107
Ogle2964
Stephenson2836
LaSalle25417
Macon25022
Clinton24717
Whiteside20915
Union20519
Grundy1935
Coles19017
Iroquois1755
Tazewell1728
Knox1680
Adams1671
Monroe15513
Williamson1554
Warren1490
Cass1388
Morgan1343
Jefferson11417
Henry1111
McDonough10615
Lee1052
Vermilion892
Pulaski840
Marion770
Montgomery731
Macoupin673
Douglas610
Perry611
Jo Daviess541
Livingston542
Christian504
Jasper477
Woodford462
Franklin450
Ford421
Clark400
Jersey401
Bureau372
Menard310
Effingham301
Cumberland290
Mercer290
Johnson270
Washington250
Alexander240
Fayette243
Mason240
Moultrie240
Wabash230
Piatt210
Bond201
Carroll202
Crawford200
Hancock201
Logan200
Shelby201
Edgar190
De Witt180
Wayne181
Fulton160
Massac160
Saline160
Schuyler130
Lawrence120
Marshall120
Brown100
White100
Richland90
Greene80
Henderson80
Hamilton70
Gallatin60
Pike60
Stark60
Clay50
Edwards50
Hardin20
Calhoun10
Pope10
Putnam10
Scott10
Out of IL00

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Confirmed Cases: 51079

Reported Deaths: 2756
CountyConfirmedDeaths
Marion12019693
Lake5588248
Elkhart353959
Allen2939134
St. Joseph210669
Hamilton1691101
Cass16449
Hendricks1454100
Johnson1340118
Porter82638
Tippecanoe7709
Vanderburgh7276
Clark69544
Madison67464
LaPorte61628
Howard59858
Bartholomew59745
Kosciusko5754
Marshall5449
Noble51328
LaGrange4849
Boone48244
Jackson4783
Delaware47152
Hancock46736
Shelby45425
Floyd40644
Morgan34231
Monroe34028
Grant31826
Dubois3046
Henry30018
Montgomery29720
Clinton2903
White27410
Dearborn25823
Decatur25632
Lawrence25225
Vigo2528
Warrick25029
Harrison21722
Greene19432
Miami1932
Jennings17912
Putnam1738
DeKalb1694
Scott1649
Wayne1546
Daviess15017
Perry14710
Orange13723
Steuben1362
Jasper1352
Ripley1307
Franklin1278
Gibson1202
Wabash1162
Carroll1142
Fayette1067
Whitley1066
Starke1043
Newton10010
Huntington942
Jefferson862
Wells821
Randolph794
Fulton731
Knox710
Jay700
Washington681
Pulaski661
Clay645
Rush613
Posey570
Spencer541
Owen521
Benton510
Sullivan501
Adams491
Brown431
Blackford402
Fountain352
Crawford330
Switzerland320
Tipton321
Parke270
Martin260
Ohio230
Vermillion200
Warren151
Union140
Pike110
Unassigned0193