Tariffs raise prices. It's textbook economics, and we're starting to see it happen now, anecdotally at least.

Why it matters: To put it mildly, Americans dislike high inflation.

• It's politically toxic, as Democrats recently learned.

The big picture: Tariffs are happening fast, and they're a moving target. Yesterday's 25% is today's 50%.

• Increases have yet to show up in the official inflation data.

State of play: Surveys and anecdotes about price increases are piling up.

• "Tariffs have increased the cost of doing business," a firm in transportation and warehousing said in the comments of yesterday's Institute for Supply Management report on activity in the service sector.
• A clothing retailer told the Boston Fed it took a "rare step" of retagging its inventory "with higher prices to cover the cost of tariffs, and those items will hit store shelves this summer," per yesterday's Beige Book release.
• Tariff-related price hikes appear to be hitting the shelves at Walmart and Target as well, Business Insider reported this week. Employees have been posting pictures of certain products showing sharp increases.

Zoom in: About three-fourths of companies said they were either fully or somewhat passing along higher tariffs by raising prices, per a survey of businesses out yesterday from the New York Fed.

• The survey was conducted among manufacturers and service firms early last month, before President Trump lowered tariffs on Chinese imports to 30% from 145%.
• While this is a regional survey of New York and New Jersey firms, the authors indicated that these are trends observed nationwide.

The intrigue: "A significant share" of firms surveyed said they raised prices of goods and services unaffected by tariffs, as a way to spread higher costs across inventory, or to take advantage of customer expectations that prices are rising.

• It's a phenomenon we've seen before. After the first Trump administration raised tariffs on washing machines, the price of dryers — unaffected by tariffs — also went up, as companies took advantage of the moment.

"A big increase in the tariff level is a perfect opportunity for companies to use a price shock to raise prices," Alex Jacquez, an economist who served in the Biden White House, said on a press call yesterday.

Reality check: Tariff policies will increase inflation by 0.4 percentage points in 2025 and 2026, "reducing the purchasing power of households and businesses," per the latest estimates from the Congressional Budget Office out yesterday.

• That's not nothing, but it's not near what we saw in 2022 and 2023.

The other side: There are some, particularly in the Trump administration, who argue the costs of tariffs are outweighed by the benefits, like returning production back to the U.S., creating better jobs, and strengthening supply chains.

Between the lines: Higher prices are going to hit differently than they did when inflation spiked in 2022. Back then the economy kept chugging along thanks to an overheated labor market, which gave companies the freedom to keep raising prices, and people had jobs and could afford to pay.

• The cushion is missing now, former Fed economist Claudia Sahm wrote on Substack. That could set a ceiling on price hikes, as consumers put up more resistance.

The bottom line: Prepare to pay more for more.

The cost to cover a family of four through workplace insurance now exceeds $35,000, nearly triple what it cost 20 years ago as annual growth in health costs have far outpaced wages.

The big picture: Growing pharmacy and outpatient facility costs drove most of the increase, which includes employee and employer shares, according to the 2025 Milliman Medical Index.

• Employers have been wary of passing health cost hikes to workers in a tight labor market, but the rising demand for costly care may force a reckoning.

State of play: The $35,119 annual cost to cover a hypothetical family of four this year factors in drug costs, inpatient and outpatient care, and professional services, along with an "other" category that includes home health, ambulance transport, medical equipment and prosthetics.

• A year of health care cost a family of four $12,214 in 2005, the year Milliman launched the index. The 20-year cumulative gain of 188% outpaced the 84% growth in wages over the same time.
• Health costs have increased about 6% per year on average over the past two decades, according to Milliman, compared with an average inflation rate of 2.5% over that time.

Between the lines: Employers in 2025 still shoulder 58% of employee health care costs, but their share has shrunk since 2005, when it was more than 60%.

Reality check: Health care costs vary significantly by age, geography and pharmacy rebate arrangements.

• Milliman calculates family cost based on a family with a 47-year-old male, 37-year-old female, and children ages 4 and under 1.
• This was a "mathematically average" family in 2005, and Milliman continues to use that formula to keep data comparable year-to-year.
• The firm has an online tool that allows readers to input other family configurations to see their estimated 2025 health care costs.

The analysis is based on Milliman's proprietary research tools and analyzes commercial claims data. The family cost figure reflects nationwide average negotiated provider fees and average PPO benefit levels.

It's beginning to feel like a sea shift in the IPO market.

The big picture: For the past two years, most unicorns delayed IPOs until they could "grow into" their valuations.

• Part of this strategy was to protect against dilution and to maintain employee morale, although ego also seemed to play an outsized role.
• There also were fears that public market investors would view valuation discounts as a sign of weakness and drive share prices down even further (i.e. deSPAC redux).
• Now, however, there's a cohort of firms that have decided to stop endlessly circling their destination. And they've been rewarded, often with upsized IPOs and strong aftermarket performance. Hinge and eToro, for example, are up double digits from their IPO prices, respectively.

Zoom in: Yes, some of these companies and later-stage investors might be getting some shove from clauses in structured deals, but that's par for the course after a valuation bubble.

Look ahead: The private markets often operate with a herd mentality, which means this recent IPO burst should have tailwinds, with an obvious caveat of macroeconomic disruptions.

• This is not so much during the early summer, when bankers still like to vacation, but in the run between Labor Day and Thanksgiving.

The bottom line: We've heard "wait till next half" for years when it comes to IPOs.

• This time it might actually turn out to be true.