1 week Ago
2 Shares Email Facebook Twitter LinkedIn By Michael Mufson Tariff-related uncertainty is cascading through the investment ecosystem. This environment is particularly challenging for private investors and venture capital investors, who rely on predictable capital markets and functioning global supply chains to drive value creation and liquidity. Uncertainty in the economy affects all sectors of investing, and family office and private equity sponsored funding deals, especially venture-backed M&A — are no exception.
When the investment community is confronted with material uncertainty in the near-term, decision-making becomes a synthesis of the most relevant data available, and a consensus is usually reached. Currently, the overwhelming conclusion of the markets is clear: Tariffs are not good for the economy or for the global supply infrastructure developed over the past 30-plus years. The effects of tariffs Tariffs function as a tax on American businesses importing foreign products.
As such, they increase costs within the supply chain — much like a game of "whisper down the lane," with each participant adding their tariff cost to the next member of the chain. The result is higher consumer prices to cover the newly imposed tax. Unlike direct payments to the government, these costs cascade through the supply chain, dampening economic activity.
Over time, higher costs push buyers toward alternative markets, potentially hurting U.S..
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