Gary Cohn's Shadow: How Pro-Business Policies Could Reshape Markets in 2025

Gary Cohn's influence on U.S. economic policy is resurfacing as speculation grows about his potential re-entry into the Trump administration in 2025. While not officially confirmed, Cohn's recent public commentary and his historical role as a key architect of Trump's 2017 tax cuts and trade policies suggest his fingerprints could again shape fiscal and regulatory decisions. For investors, understanding how his pro-business agenda might play out in 2025—and the sectors poised to benefit—is critical for positioning portfolios ahead of potential market shifts.

Cohn's Historical Blueprint: Pro-Business, Pro-Growth

As director of the National Economic Council under Trump (2017–2018), Cohn spearheaded the landmark Tax Cuts and Jobs Act, which slashed the corporate tax rate to 21% and reshaped global competitiveness for U.S. firms. His tenure also saw aggressive trade policies, including tariffs on Chinese imports, aimed at reshoring manufacturing and boosting domestic industries.

But Cohn's legacy isn't just in tax cuts. He prioritized deregulation, particularly in finance, and advocated for infrastructure spending—themes that could resurface in 2025. “Cohn's focus on predictability and market-friendly policies has always been a throughline,” said a former administration official. “Even if he's not in office, his ideas are still a blueprint for this White House.”

2025 Scenarios: How Cohn's Influence Could Play Out

Recent interviews and public statements by Cohn hint at potential policy directions for 2025:

1. Tax Reform 2.0: Lowering the Corporate Rate to 15%
   Cohn has argued that reducing the corporate tax rate further to 15% could cement U.S. competitiveness with global peers. While congressional hurdles remain (e.g., budget reconciliation rules), Trump's administration is reportedly prioritizing this via reconciliation bills. A success here would disproportionately benefit sectors like energy, manufacturing, and finance.

1. Trade Policy: Tariffs with a Twist
   While Cohn supported tariffs in 2017–2018, he has recently warned of their inflationary risks. A potential compromise could involve selective tariffs targeting strategic sectors (e.g., semiconductors, critical minerals) while easing others. This could boost companies with global supply chain agility but penalize industries reliant on Chinese imports.

2. Infrastructure and Tech Investment
   Cohn's advocacy for AI-driven growth (highlighted in May 2025 interviews) aligns with Trump's “American technological dominance” agenda. Look for increased funding for quantum computing, 5G, and green energy projects—sectors where IBM (Cohn's current employer) and tech giants like NVIDIA (NVDA) are already leaders.

Market Implications: Sectors to Watch

Investors should position for a “Cohn-driven” 2025 economy by focusing on:

• Financials: Lower corporate taxes and reduced regulations could boost bank profitability. Watch for sector ETFs like XLF and individual plays like JPMorgan (JPM) or Goldman Sachs (GS).
• Energy/Manufacturing: Tax cuts and infrastructure spending favor companies like Caterpillar (CAT) or Chevron (CVX), which benefit from domestic drilling and industrial demand.
• Technology: AI and semiconductors are front-and-center. NVIDIA (NVDA) and Intel (INTC) could see tailwinds from federal R&D funding.
• Commodities: Infrastructure spending and a potential Fed pivot toward rate cuts (if inflation cools) could lift copper (via CUPM) and industrial metals.

Risks and Caveats

Not all roads lead to smooth sailing. Cohn's warnings about tariff-driven inflation (April 2025) suggest markets might face volatility if trade policies reignite price pressures. Additionally, Democratic opposition could stall reconciliation bills, leaving tax reform in limbo.

Investment Strategy: Balance Growth and Caution

• Equities: Overweight sectors tied to tax reform and tech innovation. Avoid industries (e.g., retail) vulnerable to tariff-driven inflation.
• Bonds: If the Fed pauses rate hikes (as Cohn's Fed collaborator Kevin Warsh hinted in May), consider shorting Treasuries or investing in floating-rate notes.
• Hedging: Use gold (GLD) or volatility ETFs (VIXY) to protect against trade-policy shocks.

Conclusion

Gary Cohn's potential re-entry into the Trump administration—whether formal or advisory—could reignite a pro-business, pro-growth agenda with far-reaching market impacts. For investors, the playbook is clear: tilt toward sectors benefiting from tax cuts and tech investment while hedging against trade-related inflation. As Cohn himself noted in May: “Policy certainty is the fuel for growth.” In 2025, that certainty could make all the difference.

Stay vigilant and let the data guide your bets.