Corporate America Is Picking Up the Tab for Trump’s Tariffs

Key Takeaways

U.S. corporations are largely absorbing the $55 billion in new tariffs, delaying cost pass-through to consumers due to market uncertainties.
Banks are tightening credit card lending, favoring high-spending, high-credit-score customers as a hedge against economic uncertainty.
Columbia University's $200 million payment for federal funding restoration could serve as a model for other universities facing anti-Semitism allegations.
Hopes are rising for a significant U.S.-Europe trade deal, potentially establishing 15% baseline tariffs pending presidential approval.

American companies have absorbed an additional $55 billion in U.S. tariffs this year, opting not to raise prices immediately due to market uncertainty and competition.
Economists predict these costs will eventually impact consumers through higher prices, reduced hiring, or fewer new product offerings.
Meanwhile, discussions between the U.S. and Europe suggest a potential new trade deal, which could establish 15% baseline tariffs on most goods.

New credit card openings dropped by 5% in the second quarter as banks become more selective with applicants.
Lenders are now prioritizing customers with high credit scores who regularly charge and pay off large balances, seeing them as more profitable and less risky.
This cautious approach from banks suggests a hedging strategy in response to an uncertain economic outlook, despite indicators of overall economic strength.

The White House is reportedly seeking fines from universities for inadequate responses to anti-Semitism to restore federal funding.
Columbia University's recent $200 million agreement is highlighted as a potential blueprint for other institutions like Cornell, Duke, and Harvard.
Universities are balancing the critical need for federal research grants with concerns about appearing to concede to administrative demands from alumni and faculty.