U.S. uncertainty stifling business investment: TMX CEO

Thu Dec 6, 2012 6:27pm EST
 
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By John McCrank

NEW YORK (Reuters) - Political, fiscal, and regulatory uncertainty in the United States is hampering capital investment in the country and beyond, Tom Kloet, chief executive of TMX Group X.TO, Canada's biggest exchange operator, said on Thursday.

Kloet, a Chicago native who guided TMX through its recent C$3.8 billion ($3.84 billion) takeover by Maple Group, a consortium that includes some of Canada's biggest banks, pension funds, and insurers, said the lack of compromise in Washington on the "fiscal cliff" is frustrating and stifles business.

"As a business owner that represents 4,000 listed issuers on the stock exchange of the biggest trading partner the United States has, I've got to say that the uncertainty is really hurting the appetite for capital expenditures and capital investment right now," he said.

With less than a month left to confront the steep budget cuts and tax increases that will begin taking effect in January and could send the economy back into recession, Democrats and Republicans have yet to find common ground on some key issues, preventing a deal.

Kloet said that aside from reaching an agreement on the fiscal cliff, politicians could help restore confidence in the market by being proactive about initiating comprehensive tax reform in a bipartisan way with government and industry input.

"This idea of solving things with a gun to your head all of the time just doesn't seem like the right path," he said.

EXPANSION

The Toronto Stock Exchange parent's main focus is on paying down its large debt load related to the Maple deal and integrating former rival Alpha, as well as clearinghouse Canadian Depository for Securities Ltd (CDS).   Continued...

 
TMX Group Inc. Chief Executive Officer Thomas Kloet smiles before the annual general meeting of shareholders in Toronto May 11, 2012. REUTERS/Mike Cassese