Trump Tariffs: Boost US Economy or Spike Inflation?

The Most Important Thing

risk is largely a matter of opinion

Jerome Cody

·2 years ago

shared a poll post in group #The Most Important Thing

Trump says his tariff plan will boost the US 👍, Critics say it could spike inflation 👎
What do you think? 

“The most beautiful word”... what President-elect Donald Trump has called tariffs. During his campaign, Trump vowed to slap a tariff of 10 to 20% on all imports to the US, plus a tariff of 60% or more on shipments from China. He’s also threatened a 100% tariff on imports from Mexico, Canada & all the BRICs too. Tariffs — taxes placed on imported goods — are a tool lots of countries use to protect domestic industries, exert political leverage, and raise tax $$.

Jerome Cody
The S&P 500 ended last week on a soft note, weighed down by the threat of a widespread tariff hike. Remember, Trump always raises tariffs (or TART, if you like). The benchmark US stock index gave back 0.3%, the Nasdaq 100 fell 0.2%, and the Russell 2000 slumped 1.3%. sherwood.news/markets/fro..
sherwood.news
From TACO to TART? US stock futures sink as Trump threatens blanket 15% to 20% tariffs
Will markets move away from TACO (Trump Always Chickens Out) toward TART (Trump Always Raises Tariffs)?...

Cyril cast a vote

Cyril
Tariffs might be starting to show in America’s inflation rate — but where are prices rising the most? According to new data from the Bureau of Labor Statistics, consumer prices rose 2.7% year over year in June, slightly above expectations and the fastest pace since February. President Trump’s sweeping tariffs may finally be filtering through to nudge up prices on a range of goods. Beyond the monthly ups and downs, we charted what inflation has hit hardest — and the categories where prices have actually fallen — in the last 12 months. sherwood.news/markets/tar.. #Data is beautiful
sherwood.news
Tariffs might be starting to show in America’s inflation rate — but where are prices rising the most?
Coffee. Content. Child care. What’s up (and down) as US inflation hits 2.7%?...

Todd Smith
Trump’s new chip tariffs could raise the cost of older chips which power a wide range of consumer goods, but are unlikely to affect AI chips. theinformation.com/articl..
www.theinformation.com
Trump’s New Chip Tariffs Could Raise Prices For Cars and Tools But Not AI
President Donald Trump’s plan to impose 100% import tariffs on semiconductors is unlikely to affect the advanced chips designed by Nvidia and big U.S. tech firms for artificial intelligence. But depending on how the tariffs are applied, they could raise the cost of older chips which power a wide ...

Cyril
Investors and CEOs have completely ditched the idea that tariffs will cause a recession There’s no doubt execs and analysts are still talking a lot about tariffs, but something major has shifted. While mentions of “recession” and related terms in S&P 500 companies’ quarterly earnings calls have dropped precipitously to their lowest level since 2005, references to tariffs (while down) remain extremely high relative to history — you can see this in our side-by-side chart. A Bank of America survey of fund managers showed that while a trade war triggering a global recession remains the biggest tail risk, with 29% deeming it as such, that share is down substantially from 80% in its April survey. That’s despite expectations for the average US tariff rate to steadily rise from 12% in June to 15%, which tracks with the evolution of effective tariff rates. So what gives? Unlike Rumsfeld’s “unknown unknowns,” tariffs are a known known and judged to be a manageable risk by the C-suite and market participants. The levies are not yet playing the starring role in defining the average American’s total inflation experience, but are being offset by other factors. And tariffs haven’t slowed the continued profitability of US megacap tech companies, which has fueled S&P 500 12-month forward earnings-per-share estimates to an all-time high. Corporate America’s ability to adapt is another factor preventing tariffs from creating an obviously large hole. Drilling down on why the tariff announcements that brought the S&P 500 to the verge of a bear market in April haven’t produced anything nearly as dire as feared, Markets Editor Luke Kawa looks back at Fed Chair Jay Powell’s 2022 Jackson Hole speech as a turning point in the inflation narrative. It was when people really woke up and noticed that, “Hey, things are getting hot in here!” It wasn’t that the water around us frogs hadn’t been getting warmer, but it had been a slow, sleepy rise that didn’t seem dire… until it did. The third quarter of 2025 may serve as a similar alarm bell regarding the “real growth” side of the US economy. Retail earnings out soon may give us some clues as to whether the lackluster performance of consumer spending year to date is gathering momentum. But there’s also the potential outcome that the fear around these tariffs was worse than the experience of actually living with them. sherwood.news/markets/inv..
sherwood.news
Investors and CEOs have completely ditched the idea that tariffs will cause a recession
Are tariffs a “boiling frog” process... or is this water really just lukewarm?...

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