Senator Elizabeth Warren isn’t on board with President Donald Trump’s recent proposal to scrap the need for companies to report their earnings every quarter.
In a chat with Yahoo Finance on Tuesday evening, she expressed her concerns, stating, “It undermines transparency. That is the whole point here.” It’s clear where she stands on the matter. As it stands, publicly traded companies must file earnings with the Securities and Exchange Commission (SEC) every three months.
However, Trump suggested on Monday that the frequency should shift to every six months, arguing that it would save cash for companies and allow them to focus more on the future.
Warren, on the other hand, believes this proposal stems from Trump’s desire to avoid revealing real figures, as he knows his administration is having economic problems. She also mentioned Trump’s decision to fire the commissioner from the Bureau of Labor Statistics after the subpar July employment report.
She labeled this move as a classic “Donald Trump trick”: if figures aren’t favorable, hide them from view. “And that’s what he’s trying to do,” she criticized.
A spokesperson from the White House, Taylor Rogers, didn’t directly respond to Warren’s remarks, rather chose to jab at her past claims of Native American descent.
Rogers commented, “The last person who should be giving advice on SEC requirements is Pocahontas. She couldn’t even tell the truth about her own background!” It seems both sides aren’t holding back.
To dive a little deeper, companies in the U.S. have been providing quarterly earnings since 1970. Quite a shift occurred in the European Union back in 2015, moving from quarterly to biannual reporting.
Experts seem divided on whether this proposed change is beneficial, noting that it could disrupt the amount of money circulating to corporate attorneys and data providers currently assisting businesses in meeting these reporting rules.
The ride to change will take some time, as any adjustment would require SEC approval. Nonetheless, the agency has already indicated that they plan to prioritize looking into Trump’s suggestion.
Significantly, quarterly earnings reports are crucial for investors who often assess these figures as part of their decision-making process. If the reports were postponed to a six-month timeframe, investors might find themselves based on less current information.
Warren noted, “Investors do not need to see less information about the companies that they are putting their money into. After all, those companies are using investors’ money.”
