Insights
Find the latest news and insights from TrueShares below.
Tariffs vs. AI: A Tale of Two Economies
It is the best of times, it is the worst of times, it is the age of artificial intelligence, it is the age of tariffs. In this, the year two thousand and twenty-five, it sometimes feels like we are living a tale of two economies. One is a roaring bull stock market fueled largely by AI and tech while the other is a slowing economy fueled by tumultuous tariff deals. Contradictions abound as the economic indicators of Main Street fail to shake the value projections on Wall Street. So why is a slowing economy not slowing the stock market, and how might the answer impact your investments?
The Tariff Economy
When the tariff turmoil began with Liberation Day in early April, the stock market reacted with a vehement “no, thank you.” The S&P 500 had its worst day since 2020.1 Concerns about tariffs, even for the stock market, stem from concerns about what they might do to inflation as tariffs tend to raise prices. Tariffs are also feared to lead to layoffs as companies try to cut costs to compensate. Higher unemployment and reduced consumption are signs of a slowing economy.
Since that first announcement, more tariffs have been announced, delayed, rolled back, paused, and implemented. Through it all, the economy has seemingly persisted. For a while, preliminary jobs and unemployment data made the labor market look resilient. But the recent July jobs report and significant downward revisions to the numbers from previous months seems to have corrected the assumption.2
Yet with bad news comes the potential for good, as the poor jobs reports make an interest rate cut more likely, especially if the low jobs numbers continue.2 Wall Street also doesn’t seem to think the impending 15% tariffs will be enough to rock equities or cause a recession.3
The AI Economy
Amidst the tariff turmoil of 2025, the stock market has been bullish this year. The S&P 500 is on track for year-over-year earnings growth of 10.3%, well above the previously anticipated 5%.4 Big Tech and its AI economy are largely driving this upward trend, despite the tariff economy’s signs of a slowdown.
Big Tech hasn’t merely weathered the tariff storm, but has actively pursued the AI arms race as though nothing has changed. The biggest tech companies have announced that AI investments will continue in 2026 to the tune of $364 billion.4 But the effects of the AI boom aren’t limited to the stock market. AI investments drive economic activity like job growth in construction and bolster greater demand for energy and material inputs, theoretically counteracting a slowing Tariff Economy.4 Even more encouraging for bullish investors have been the exemptions from tariffs that several big tech companies like Nvidia and Apple have scored in recent months.3
So while we may be living in two economies, the stock market is not the economy writ large. It is the value and expected future earnings of publicly traded companies, which while related to, are not wholly reflective of economic indicators like consumption, employment, and commerce. The Tariff Economy and the AI Economy remain two separate economies with different impacts on investments. For now, the former is not shocking the latter.
At the same time, it’s impossible to know how they will play out. Instead of agonizing over this tale of two economies, you can hedge both sides with portfolio accessories from TrueShares. TrueShares Quarterly Bull and Bear Hedge ETFs aim to consistently navigate bull and bear market conditions, with the potential to deliver positive total returns during high volatility. By adding QBUL and QBER as accessories to your portfolio, you have the potential to be right about tariffs and AI, even when you’re wrong about both.
- https://www.nytimes.com/live/2025/04/04/business/trump-tariffs-stocks-economy
- https://finance.yahoo.com/news/the-dominant-economic-narrative-has-been-revised-chart-of-the-week-095917309.html
- https://finance.yahoo.com/news/stock-market-pullbacks-will-be-short-lived-wall-street-sees-ai-rate-cut-optimism-fueling-rally-133057446.html
- https://finance.yahoo.com/news/one-key-reason-a-slowing-economy-isnt-shaking-stock-market-bulls-100056794.html
For more information and full disclosures, visit https://www.true-shares.com/qbul/ and https://www.true-shares.com/qber/
Thought Leadership,
Straight to Your Inbox
Disclosures
©2025, TrueShares, ©2025 TrueMark Investments, LLC. (“TrueMark”).
Before investing, carefully consider the TrueShares ETFs investment objectives, risks, charges and expenses. Specific information about TrueShares is contained in the prospectus and a summary prospectus, copies of which may be obtained by visiting www.www.true-shares.com. Read the prospectus carefully before you invest.
An investment in TrueShares is subject to numerous risks, including possible loss of principal. The ETFs are subject to the following principal risks: Authorized Participants, Market Makers, and Liquidity Providers Concentration Risk associated with ETFs; Equity Market Risk; Management Risk; Market Capitalization Risk (Large Cap; Mid Cap, Small Cap Stock); Market Risk; New Fund Risk: The Fund is a recently organized, non-diversified management investment company with no operating history. As a result, prospective investors have no track record or history on which to base their investment decision. Additionally, the Adviser has not previously managed a registered fund, which may increase the risks of investing in the Fund.
Depositary Receipts Risk. American Depositary Receipts (“ADRs”) have risks similar to those of foreign securities (political and economic conditions, changes in the exchange rates, etc.) and entitle the holder to all dividends and capital gains that are paid out on the underlying foreign shares.
Individual investors should contact their financial advisor or broker dealer representative for more information on TrueShares ETFs.
Investment Products and Services are: NOT FDIC INSURED / MAY LOSE VALUE / NO BANK GUARANTEE.
All registered investment companies, including TrueShares, are obliged to distribute portfolio gains to shareholders at year-end regardless of performance. Trading in TrueShares ETFs will also generate tax consequences and transaction expenses. The information provided is not intended to be tax advice. Tax consequences of dividend distributions may vary by individual taxpayer.
TrueShares ETFs are bought and sold through exchange trading at market price, not Net Asset Value (NAV), and are not individually redeemed from the fund. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns.
ETF shares may be bought or sold throughout the day at their market price, not their NAV, on the exchange on which they are listed. Shares of ETFs are tradable on secondary markets and may trade either at a premium or a discount to their NAV on the secondary market. ETFs trade like stocks, fluctuate in market value and may trade at prices above or below the ETF’s NAV. Brokerage commissions and ETF expenses will reduce returns.
Fund Intelligence Mutual Fund Industry and ETF Award shortlists and winners are comprised of individuals and firms who have submitted entries or been nominated via the online submission process, as well as through recommendations from leading market participants. Fund Intelligence Mutual Fund Industry and ETF Award judges will use the submitted application material, as well as any uploaded supplemental information, to determine which firm, individual or product they believe to be the most suitable and deserving winners for each category. Fund Intelligence Mutual Fund Industry and ETF Award judges have the discretionary power to move nominations into alternative categories that they think may be more suitable. Fund Intelligence Mutual Fund Industry and ETF Awards were decided by an independent panel of 20 judges with expertise across the asset management space.
TrueShares ETFs (the “Funds”) are registered with the United States Securities and Exchange Commission under the Investment Company Act of 1940. The fund is distributed by Paralel Distributors LLC, Member FINRA. Paralel is not affiliated with TrueMark Investments, LLC. TrueMark Investments, LLC, is the investment advisor to the Funds and receives a fee from the Funds for its services.
TrueMark Investments, LLC is the investment advisor to the Funds and receives a fee from the Funds for its services.
TrueShares ETFs are offered only to United States residents, and information on this site is intended only for such persons. Nothing on this website should be considered a solicitation to buy nor an offer to sell shares of any fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.