Key Takeaways:
- Tariffs are now more constrained but not eliminated.
- The $175 billion tariff refund is significant, but it’s small compared to the size of the economy and the federal budget.
- Short-term policy noise may create volatility, but
What Happened?
The U.S. Supreme Court recently ruled that the President cannot use broad emergency powers under the International Emergency Economic Powers Act (IEEPA) to impose sweeping tariffs without Congress’s approval. The decision reinforces that broad tariff authority ultimately rests with lawmakers.
One of the most significant implications of the ruling is financial. Estimates per the Penn Wharton Budget Model suggest that as much as $175 billion in tariff collections could potentially be subject to refund claims. The timing and outcome of any refunds remain uncertain, but the potential refund size has drawn attention.
In response to the ruling, the administration has leaned on Section 122 of the Trade Act of 1974 as an alternative authority to impose tariffs. However, Section 122 allows only temporary tariffs for up to 150 days, after which Congressional approval is required to extend them.
Complicating matters further, the administration initially signaled an increase in the temporary tariff rate from 10% to 15%, but the final paperwork filed referenced only 10%. This discrepancy highlights ongoing confusion and shifting policy signals, which can add to market uncertainty.
In short, tariffs remain in play, but the legal pathway and duration are now more constrained and subject to greater scrutiny.
What Does It Mean for the Economy?
Tariffs function much like a tax on imports. When broadly applied, they raise costs for businesses that rely on imported goods, and those costs may be passed on to consumers.
The potential $175 billion in refunds is a meaningful number on its own. However, context is important. The U.S. economy is approximately $30 trillion in size, and the federal government currently runs annual budget deficits exceeding $1.5 trillion, contributing to a total federal debt of more than $38 trillion.
Against that backdrop, even $175 billion represents a relatively small share of overall federal finances—roughly 5% - 10% of a single year’s deficit and about 0.5% of total outstanding federal debt. In other words, while refunds could modestly affect short-term budget dynamics, they would not materially change the broader trajectory of federal deficits or long-term debt levels.
This perspective does not make trade policy irrelevant. Tariffs can influence specific industries, supply chains, and pricing decisions. However, at the macroeconomic level, their financial scale is modest relative to the size of the overall economy and federal balance sheet.
What Does It Mean for Markets?
Markets respond to both economic fundamentals and policy clarity. The Supreme Court’s ruling reduced one source of uncertainty by clarifying the limits of executive tariff authority. However, the shift to Section 122—combined with mixed signals on tariff rates—underscores that trade policy remains fluid.
The 150-day limit creates a defined timeline that markets will watch closely. Investors may see volatility tied to whether Congress approves an extension or allows the temporary tariffs to lapse.
Over the longer term, markets tend to be driven more by earnings growth, economic expansion, and interest-rate trends than by temporary tariff measures. While the fundamentals of the economy remain strong, policy uncertainty can affect sentiment and short-term price movements.
What Can Investors Do?
Policy developments can generate short-term market swings, but reacting to headlines rarely improves long-term outcomes.
Maintaining diversification across asset classes, sectors, and regions remains a prudent way to manage uncertainty. Periodic portfolio reviews and disciplined rebalancing can help ensure allocations stay aligned with long-term goals.
Trade policy may influence markets at the margin, but economic fundamentals—growth, profits, inflation, and interest rates—remain the primary drivers of long-term returns.
Securities products and advisory services offered through Park Avenue Securities LLC (PAS), member FINRA, SIPC. OSJ: 6115 Park South Dr., Charlotte NC 28210. Phone # 704-552-8507. PAS is a wholly owned subsidiary of The Guardian Life Insurance Company of America®
(Guardian), New York, NY. Genesis Wealth Planning, LLC is not an affiliate or subsidiary of PAS or Guardian. This material is intended for general use. By providing this content Park Avenue Securities LLC and your financial representative are not undertaking to provide investment advice or make a recommendation for a specific individual or situation, or to otherwise act in a fiduciary capacity.
This material was produced by an independent third party. It is provided for informational and educational purposes only. The views and opinions expressed herein may not be those of Guardian Life Insurance Company of America (Guardian) or any of its subsidiaries or affiliates. Guardian does not verify and does not guarantee the accuracy or completeness of the information or opinions presented herein. 7727964.25 Exp 3/28
Important Information
This is for informational purposes only, is not a solicitation, and should not be considered investment, legal or tax advice. The information in this report has been drawn from sources believed to be reliable, but its accuracy is not guaranteed and is subject to change. Investors seeking more information should contact their financial advisor. Financial advisors may seek more information by contacting AssetMark at 800-664-5345.
Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. Asset allocation cannot eliminate the risk of fluctuating prices and uncertain returns. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio. No investment strategy, such as asset allocation, can guarantee a profit or protect against loss. Actual client results will vary based on investment selection, timing, market conditions, and tax situation. It is not possible to invest directly in an index. Indexes are unmanaged, do not incur management fees, costs, and expenses, and cannot be invested in directly. Index performance assumes the reinvestment of dividends.
Investments in equities, bonds, options, and other securities, whether held individually or through mutual funds and exchange-traded funds, can decline significantly in response to adverse market conditions, company-specific events, changes in exchange rates, and domestic, international, economic, and political developments.
Bloomberg® and the referenced Bloomberg Index are service marks of Bloomberg Finance L.P. and its affiliates,
(collectively, “Bloomberg”) and are used under license. Bloomberg does not approve or endorse this material, nor
guarantees the accuracy or completeness of any information herein. Bloomberg and AssetMark, Inc. are separate and
unaffiliated companies.
AssetMark, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission.
©2026 AssetMark, Inc. All rights reserved.
8794278.1 | 03/2026 | EXP 03/31/2028
AssetMark, Inc.
1655 Grant Street
10th Floor
Concord, CA 94520-2445 800-664-5345