🇺🇸 Tax cuts for (almost) everyone

What’s going on here?

According to the US president, the money made from tariffs could pay for tax cuts for millions of Americans – but the math just ain’t mathing.

What does this mean?

The president believes tariffs will help even out international trade imbalances and encourage foreign companies to move more production stateside. The (theoretical) cherry on top: money made from those fees could be used to cut – or even eliminate – income taxes for Americans earning under $200,000. The president also plans to scrap taxes on tips and social security payments, and cut the corporate tax rate. But experts estimate that the tariffs will bring in only around $167 billion a year – more than a little shy of the $600 billion it’d cost to wipe out income taxes for most Americans.

Why should I care?

For markets: One in, one out.

In reality, Americans may just be swapping one tax for another. Tariffs raise costs for companies – and as they increase prices to protect their margins, the everyday consumer ends up covering much of the bill. Of course, businesses swallow some of the cost themselves. But as that then eats into corporate profit, the overall economy and stock prices can be hindered.

For you personally: The government needs to watch “Confessions of a Shopaholic”.

At the same time as cutting taxes, the US government’s planning to funnel funding into energy production and the military. That combination could tack roughly $6 billion onto its debt over the next decade. And remember, the government is already spending more than it earns. Now, a rising deficit could make US bonds riskier and lead to higher interest rates, and you know how that goes. As borrowing becomes more expensive, consumers and businesses cut back – and that, too, weighs on corporate profit and the economy.

What’s going on here?

Alibaba brought a family of open-source AI models into the world, and the Chinese ecommerce firm says its offspring are blessed with brains smarter – and cheaper – than the rest.

What does this mean?

“Qwen3” includes eight models, two of which are “mixture-of-experts” types. That means they work like a team of specialists, splitting tasks into parts to solve complex problems more efficiently. The flagship model is even said to beat rival systems from DeepSeek and OpenAI on coding, math, and general reasoning. What’s more, Alibaba says the model is cheaper to run and roll out than similarly skilled major models. That’s a claim worth paying attention to: if models like Qwen3’s start winning on both performance and cost, that could help restore investors’ confidence in China’s tech sector. And that may be enough to send the sector’s stocks back to their pre-tariff prices.

Why should I care?

For markets: It was nice while it lasted...

Some of the AI industry’s biggest winners have been the firms selling chips, cloud systems, and other essential infrastructure. In the early days, they could name their price: with only a few firms making and using AI models, they had little choice but to pay top dollar for them. But now that the likes of Alibaba are churning out powerful, open-source models on the cheap, businesses can customize smart systems for a much savvier price. Add in increasing competition, and infrastructure firms are likely to see their profit margins squeezed.

The bigger picture: Time to put those brains to work.

The next phase of AI is all about application. There are customers to be won and money to be made if a company can embed the tech into real-world workflows – especially if it’s combined with proprietary data, strong client bases, and thoughtful product design, as well as rolled out efficiently. This phase isn’t so much about building the smartest model: the breadwinners will be those who make useful, usable, and ubiquitous products.