PB Law Blog... Trusts and Stuff

Let’s talk tariffs.

Yep—those taxes on imported goods that made headlines a few years ago during the Trump administration. While they may sound like a topic reserved for economists and politicians, tariffs have had some very real, very tangible effects on everyday Americans—and could still be contributing to broader economic uncertainty today.

In Plain English:

• A tariff is a tax the U.S. government places on goods imported from other countries.
• The idea? Make foreign goods more expensive so people and businesses buy American.
• The reality? American consumers end up footing the bill.

Tariffs might sound like an abstract policy move, but you’ve probably felt them in your own home—even if you didn’t realize it.

• Appliances like washers and dryers
• Electronics and tech gear
• Construction materials (steel, aluminum, lumber)
• Everyday items made with imported parts

Bottom line: Tariffs = higher prices. Unfortunately, these costs usually get passed along to you, the consumer.

On April 3 and 4, 2025, U.S. stock markets experienced their most severe downturn since the 2020 pandemic-induced crash. [Source: How major US stock indexes fared Friday, 4/4/2025 | AP News]

These sharp declines were primarily driven by escalating trade tensions, particularly China's announcement of a 34% tariff on U.S. goods in retaliation for the U.S. tariffs The market volatility has heightened fears of a potential recession. The Federal Reserve has cautioned that ongoing trade disputes and associated tariffs could exacerbate inflationary pressures and slow economic growth.

In light of these developments, investors may consider the following strategies:

• Diversification: Ensure portfolios are diversified across various sectors and asset classes to mitigate sector-specific risks.
• Quality Focus: Prioritize investments in companies with strong balance sheets and minimal exposure to tariff-impacted supply chains.
• Stay Informed: Keep abreast of ongoing trade negotiations and policy changes, as these can have immediate and significant market implications.
• Long-Term Perspective: While short-term volatility can be unsettling, maintaining a long-term investment horizon can help navigate through market fluctuations.

Could Tariffs Help Trigger a Recession?

We’re not saying tariffs alone will tip us into a full-blown recession—but they’re part of a bigger picture, as tariffs:

• Contribute to inflation (higher costs across the board)
• Strain supply chains
• Add uncertainty for businesses trying to plan ahead

Layer that on top of rising interest rates, shaky global markets, and consumer fatigue—and yeah, there’s reason to be cautious.

Small Biz Blues

If you run or work for a small business, especially one that relies on imported parts or materials?  You’ve likely felt the squeeze too.

Tariffs have forced many businesses to:

• Raise prices
• Eat the extra cost (ouch)
• Cut costs in other areas—like staff, marketing, or operations

That’s not exactly a recipe for growth—or stability.

Other countries didn’t just sit back. Many responded with retaliatory tariffs—targeting U.S. goods like soybeans, pork, and dairy. That’s led to:

• Drops in exports
• Financial stress for American farmers
• The need for federal bailouts (a.k.a. your tax dollars at work)

Because this stuff isn’t just policy—it’s personal. Tariffs (and the ripple effects they cause) can:

• Impact your cost of living
• Influence how your business runs
• Affect long-term investments, estate planning, and even real estate values

Whether you’re a small business owner dealing with rising costs or someone trying to future-proof your investments, these economic shifts matter. And legal strategy plays a big part in planning around them.

If you’ve got questions about how tariffs or other trade policies might impact your business or estate, our team is here to help.

Let’s talk strategy—without the jargon.  To schedule a consult with one of PB Law’s  Estate Planning + Business Planning attorneys, submit a Consult Request here. 

By:   Tiffany Ballenger Floyd, Esq.,  |  Licensed in CA + NV | Managing Partner | Phillips Ballenger PLLC

Photo Credit:  Thanks to Nik on Unsplash