How US investors should think about tariffs as Trump braces for a fresh round of haggling

Tariffs continue to rattle investors, yet they didn’t factor into my 2026 stock forecast.Why? Consider the “four e’s” – expectations, exemptions, evasion, and enforceability.

They ensure the ups and downs of President Trump’s current and future levies pose more economic bark than bite.To be sure, tariffs are always bad – especially for the country imposing them.US stocks’ serious lag versus world stocks in 2025 was partly because of that.

Trump’s newer blanket 10% global trade taxes imposed (after the Supreme Court killed his “Liberation Day” tariffs) aren’t good.Nor is his threat to raise that to 15%, or to squash the US-UK trade deal, or the 50% duty he threatened on China.But for stocks, surprises matter most.

Tariff turmoil is now old news, baked into expectations … and into stock prices.That is a 180-degree turn from last April, when the breadth, magnitude and sheer weirdness of Liberation Day duties startled the market.

Stocks swooned, pre-pricing worst-case scenarios of retaliation and trade devastation — all overdone for all the reasons I detailed last May.Global trade grew 3.4% in 2025.Even Chinese exports – directly in Trump’s crosshairs – rose 5.5% overall despite US-bound shipments plunging.

Stocks rebounded big time.But how?Consider the second “e” – exemptions.

For all of Trump’s talk, over half of all US imports were duty free before the Supreme Court ruling.Smartphones and semiconductor chips? Exempt.

Many pharmaceuticals? Exempt.Nickel, tin, LEDs, coffee, beef, bananas? All eventually exempted after backlash.

His new 10% global levy includes slightly more exemptions.For tariffed items, evasion was easy – so-called “transshipping” to a lower-tariffed intermediate hub, for example.Consider: China’s exports to southeast Asian economies boomed.

In parallel, America’s 2025 imports from ASEAN nations leapt 29%.Coincidence? No – transshipping! Mind you, shadier, even illegal shirking techniques...