If you’re a big-cap tech company, you have a huge advantage in markets right now. You’re able to license your software, sell your gadgets, and not worry about the impact of tariffs.
For companies that rely on tariffs, it’s a different story. That’s because, as President Trump continues to tinker with tariff rates, most companies have operated as though it’s just a short-term headwind:
Businesses are largely eating the costs of tariffs, a trend that can’t last forever. (Source: Goldman Sachs)
With businesses eating two-thirds of the costs of tariffs, import-dependent companies are likely to have a weak growth profile as long as tariffs last.
And with trade deals leaving some higher level of tariffs in place compared to a year ago, it’s another reason why the S&P 493 will likely continue to underperform the Magnificent 7 plays.
For the time being, businesses are sacrificing profit margins at the expense of inflation – an unsustainable trend. And another hallmark of the divergence between the tech mania on Wall Street and the real economy.
~ Addison
P.S. Of course, some companies are benefitting from the changing tariff regime, as well as from President Trump’s other economic policies, which are more clearly pro-growth.
That’s why it’s critical to know the best places to invest right now. Our research on President Trump’s MAGAnificent 7 plays is a great place to start.
A special note to Grey Swan subscribers: This week’s Grey Swan Live! will be held on Friday at 11 AM, not Thursday. We’re in the middle of some new groundbreaking research – and will have even more details that afternoon. But our paid-up Fraternity members will get an early sneak peek at what we see developing.
For now, mark your calendar:
Sneak Peek Grey Swan Live!
Friday, August 15, 2025
11am ET
As always, your reader feedback is welcome: feedback@greyswanfraternity.
