Wall Street spent the week staring at tariff percentages, but the real story went down at the Supreme Court. The Court struck down Trump’s previous global tariff program, ruling that emergency powers under IEEPA could not be used to impose sweeping import levies. That decision wiped out the legal foundation for the structure that had collected more than $175 billion in duties.

Trump responded by invoking Section 122 of the Trade Act of 1974, which allows temporary tariffs of up to 15% for 150 days in response to balance-of-payments or currency issues. As of this week, a 10% global tariff is in effect on most goods entering the U.S. under that Section 122 authority, with the administration saying it intends to raise that to 15%. Temporary Section 122 tariffs will expire after 150 days unless Congress approves an extension. 

Other trade measures remain in place. Section 232 national security tariffs continue. Anti-dumping and countervailing duties remain active. USMCA-qualified goods still receive preferential treatment. 

That loss to the Supreme Court unfolded against the backdrop of a State of the Union address that sought to praise economic achievement under the current administration. Stripped down to actual numbers a soberer report card would read something like this: Inflation is 2.4% YoY, which is lower than when Trump took office in January 2025, when it was around 2.9%. It hasn’t exactly “plummeted”, and the Federal Reserve’s target is 2%. The bottom…

Wall Street spent the week staring at tariff percentages, but the real story went down at the Supreme Court. The Court struck down Trump’s previous global tariff program, ruling that emergency powers under IEEPA could not be used to impose sweeping import levies. That decision wiped out the legal foundation for the structure that had collected more than $175 billion in duties.

Trump responded by invoking Section 122 of the Trade Act of 1974, which allows temporary tariffs of up to 15% for 150 days in response to balance-of-payments or currency issues. As of this week, a 10% global tariff is in effect on most goods entering the U.S. under that Section 122 authority, with the administration saying it intends to raise that to 15%. Temporary Section 122 tariffs will expire after 150 days unless Congress approves an extension. 

Other trade measures remain in place. Section 232 national security tariffs continue. Anti-dumping and countervailing duties remain active. USMCA-qualified goods still receive preferential treatment. 

That loss to the Supreme Court unfolded against the backdrop of a State of the Union address that sought to praise economic achievement under the current administration. Stripped down to actual numbers a soberer report card would read something like this: Inflation is 2.4% YoY, which is lower than when Trump took office in January 2025, when it was around 2.9%. It hasn’t exactly “plummeted”, and the Federal Reserve’s target is 2%. The bottom line: Inflation has cooled modestly. Gasoline prices have fallen around 18 cents since Trump took office, but groceries are up 2.9% YoY, housing is up 3.4%, medical care is up 3.2%, and electricity has risen a dangerous 6.3%. Food has been volatile but is also higher than a year ago. Real incomes do appear to be stabilizing, with wages rising slightly faster than inflation, but unemployment is at 4.3% and the labor market is softer than it was two years ago. The economy is not in crisis, but it’s also not booming.  

The bigger picture is that GDP contracted 0.6% in the first quarter of Trump’s second term, largely because of a surge in imports ahead of tariff warfare, and then expanded in the following quarters. National debt has risen by more than $2 trillion under Trump, pushing total debt past $38 trillion. 

The pace of debt accumulation has been the fastest outside the pandemic period.