Tariffs Bring In Billions, But Leave US Consumers Paying The Price

<p>The reciprocal tariffs rolled out under US President Donald Trump are proving to be a slow-moving threat for Wall Street &mdash; one that does not trigger an immediate meltdown but steadily distorts markets, raises costs for consumers and risks retaliatory measures, according to a recent analysis.</p>
<p>Writing in One World Outlook, commentator Zoya Najeeb warned that the absence of instant chaos should not lull investors or policymakers into complacency. &ldquo;Just because the storm isn&rsquo;t here yet doesn&rsquo;t mean it isn&rsquo;t coming,&rdquo; she observed, reported IANS.</p>
<h2><strong>Market Calm Masks Deeper Economic Strain</strong></h2>
<p>While stock markets remain buoyant, with major US indexes recently touching record highs, the underlying reality is far less cheerful. The April panic over potential trade disruptions has given way to an almost casual acceptance of a new tariff regime &mdash; one that may prove far more expensive than investors currently acknowledge.</p>
<p>White House press secretary Karoline Leavitt celebrated $29 billion in tariff revenue collected in July, while Commerce Secretary Howard Lutnick forecast monthly revenues could soon hit $50 billion. But as the report notes, tariffs are simply &ldquo;taxes by another name,&rdquo; and these new levies arrive at a time when lower-income households are already struggling in the US.</p>
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<h2>Corporate Costs and the K-Shaped Divide</h2>
<p>Industrial giant Caterpillar Inc. expects tariffs to cost it as much as $1.5 billion in 2025, including $500 million in the current quarter alone. Despite this, its share price has held firm, buoyed by investor optimism in unrelated sectors such as AI-driven data centres and infrastructure spending.</p>
<p>This disparity illustrates the K-shaped nature of the US economy &mdash; Wall Street enjoying record valuations while ordinary Americans grapple with rising grocery prices and turn increasingly to &lsquo;buy now, pay later&rsquo; schemes to cope with daily expenses.</p>
<h2><strong>Tech-Led Gains Hide Weakness Elsewhere</strong></h2>
<p>The AI boom has played a central role in lifting market averages. However, if technology stocks are excluded, the S&amp;P 500 index has been largely flat. Veteran investor Warren Buffett, often seen as a long-term optimist, has been quietly selling holdings for 11 consecutive quarters. He has built up a $344 billion cash reserve, suggesting he is preparing for a market downturn.</p>
<h2><strong>Warnings of Choppy Waters Ahead</strong></h2>
<p>Former US House Speaker Paul Ryan has also sounded caution, pointing to potential legal challenges to the tariffs and the turbulence they could create.</p>
<p>For now, Wall Street&rsquo;s confidence remains intact, but the report warns that the costs of this trade strategy may surface slowly, and by the time they do, the damage could be far harder to reverse.</p>