Stocks Near Records as Tariffs Threaten Growth

U.S. investors came into Jan. 6 and early Jan. 7 leaning risk-on after a calmer inflation backdrop undercut a key worry from last year. In a markets snapshot, the S&P 500 closed up 0.64% and sat within 1% of its record, a sign that traders are treating tariffs as more of a growth drag than an inflation shock.

Bond markets told a more cautious story about fiscal math, not near-term prices. The same update flagged the 5-year Treasury yield rising from 3.55% to 3.727% and the 10-year moving from 3.95% to 4.187% over three months. Higher yields can coexist with rising equities when investors see resilient growth but demand more compensation for financing deficits.

Commodities traders are also watching whether geopolitics can translate into barrels. Axios reported Trump said the U.S. could receive 30 million to 50 million barrels of sanctioned Venezuelan oil, worth roughly $2.5 billion. The immediate market impact is less about spot supply and more about the feasibility of getting production up in a country where output has been structurally impaired for years.

Next steps are likely to be headline-driven. Investors will look for concrete mechanisms, such as executive action, licensing, or operational control arrangements, that could move Venezuelan crude into legal supply chains. Positioning takeaway. enjoy the equity tailwind from softer inflation fears, but keep duration and energy sensitivity in mind as policy details land.

Economists are revising a core 2025 narrative: tariffs may not be the inflation accelerant many predicted, but they can still do lasting damage via weaker growth and higher unemployment. Axios flagged new research arguing the effective tariff rate paid by importers is materially below what policy announcements imply, thanks to exemptions, compliance workarounds, and timing effects.

The key numbers are the gap between what was announced and what hit the economy. The paper cited by Axios estimates the statutory, announcement-implied tariff rate was about 27% as of September, while the “actual” rate compiled from receipts and imports was closer to 14%. That difference matters because it reduces pass-through to consumer prices and makes the inflation channel weaker than forecasters modeled.

Revenue trends reinforce that point. Fortune reported tariff receipts peaked at $34.2B in October and slipped to $32.9B in November and $30.2B in December. Pantheon Macroeconomics’ estimate in the same piece put the uplift to PCE inflation at about 0.9 percentage points, with firms absorbing roughly 0.3. Meanwhile, Axios noted San Francisco Fed work suggesting tariffs can be disinflationary in the medium term if they cool demand and raise unemployment.

Why now. The catalyst is the collision between muted inflation prints and the realization that tariff impacts show up through uncertainty, investment delay, and labor-market slack more than sticker prices. Likely next steps include more carve-outs and compliance optimization, which could keep the statutory-actual gap wide. Reader takeaway. reframe tariffs as a growth and earnings-quality issue, not just a CPI story, and watch labor-market data for the real signal.

• Venezuela oil mechanics: whether the U.S. can operationalize 30 million to 50 million barrels without triggering fresh legal or logistical bottlenecks.
• White House. oil exec meeting: outcomes from Trump’s planned Friday meeting and any timeline for boosting Venezuelan output.
• Tariff “true rate” gap: whether the 14% actual rate drifts up toward policy-announced levels or stays structurally lower.
• Tariff receipts trend: follow whether revenue continues below the $34.2B October peak. Falling receipts could mean less price pressure but worse deficit optics.
• Argentina payment risk: confirmation that the $4.3B due Jan. 9 is paid without heavy reserve draw, and what financing tool is used if not.