💰 5 Fact Friday: AI Saves Google, Sweeney Saves AEO

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ECONOMY
1. Tariffs Face Legal Test Worth $210 Billion ⚖️

Trump’s signature tariffs just hit a $210 billion legal speed bump.

A federal appeals court ruled that the Trump administration illegally used emergency powers under the International Emergency Economic Powers Act (IEEPA) to impose tariffs on dozens of countries. The ruling targets all “Liberation Day” tariffs, including duties of 50% to 145% on imports from China, India, and Brazil.

But don’t expect those tariffs to disappear overnight.

The ruling is real, but its enforcement is paused until October 14. In the meantime, the federal government has requested an emergency Supreme Court review.

If the high court takes up the case and sides with the lower court, the U.S. Treasury could be on the hook to refund hundreds of billions of dollars in tariff revenue.

Who gets the money?

Not you, unfortunately. Importers like Walmart, Amazon, and thousands of other retailers and manufacturers could be in line for substantial checks.

You might think: “Great! Ending tariffs should lower inflation.” After all, that’s been the popular narrative all year.

But the markets had a different take.

If the Treasury has to issue massive refunds, that cash has to come from somewhere. And with no surplus in sight, the government would likely turn to more borrowing — a.k.a. money printing.

After the ruling dropped:

• Gold prices hit an all-time high, now over $3,600 and up 38% on the year

• Treasury yields spiked, briefly flirting with 5%

This was not a celebration. It was a warning sign.

Removing a major source of revenue, issuing $210 billion in refunds, expanding tax cuts, and prepping for a possible rate cut in two weeks isn’t exactly a recipe for price stability.

The Supreme Court is widely expected to hear the case in its new term beginning next month. Legal experts think a final ruling could land sometime in mid-2026. Until then, the tariffs stay put and the fiscal drama continues.

Why It Matters for You

• Cost of credit: Higher Treasury yields often lead to higher interest rates on mortgages, credit cards, and business loans.

• Inflation risk: Markets aren't cheering the end of tariffs. They're bracing for more fiscal strain and possible inflation.

• Cost of goods: Apparel, electronics, furniture, machinery, and even bicycles could get cheaper if tariffs are rolled back.

• Investments: Could be a boon for retailers, foreign exporters, and emerging markets, but a blow to U.S. manufacturers facing new competition.

This is a legal, political, and economic decision that could shape everything from taxes to inflation for years to come. Stay tuned.

STOCKS
2. Court Lets Google Keep Chrome 🏛️

Google just dodged a major breakup — and it has AI to thank.

A federal judge ruled that Google can keep its Chrome browser, despite accusations of monopolistic behavior. The Justice Department had floated extreme remedies, including a forced Chrome sell-off and a ban on Google’s $20 billion-a-year search deal with Apple.

Then came a surprise twist: Perplexity offered $34.5 billion to buy Chrome, in hopes of forcing the breakup. It didn’t work.

In his 226-page opinion, Judge Amit Mehta pointed to the rise of generative AI tools like ChatGPT and Perplexity as a major reason for restraint. While the court found that Google did engage in anticompetitive conduct, Mehta noted that the search landscape is shifting fast.

He added that this shift weighed in favor of "caution" before imposing structural changes.

Here’s what the court decided:

1. Google keeps Chrome, avoiding a messy spinoff

2. Apple keeps its $20B/year deal, but it must renegotiate annually

3. Exclusive search deals are banned, but non-exclusive ones can continue

4. Google must share certain search data with competitors

The ruling is a clear win for both Alphabet and Apple. Alphabet stock jumped 9%, adding around $230 billion in market cap. Apple rose nearly 4%, good for about $130 billion in gains.

Here’s the twist: Google wasn’t cleared of wrongdoing. It was let off easy because the judge no longer sees its dominance as unshakeable.

After all, AI is already chipping away at Google’s core business.

With more and more “searches” starting outside of traditional search engines, Google has been forced to disrupt itself. One in five Google searches now include an AI summary. According to Pew, those summaries result in about 40% fewer clicks — striking at the heart of Google’s ad model.

It’s no wonder Google is pivoting. In 2017, search ads made up 87% of the company’s total revenue. Today, that share is less than 75%.

Bottom line: The court didn’t excuse Google’s past behavior. It simply acknowledged that the future looks different. In this new era of AI-driven search, the top spot is still up for grabs.

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FAST FACTS
3. New Listings, New Laws, And New Money 🧾

🚀 IPO frenzy returns to Wall Street — Klarna and Gemini headline a five-company push that could deliver the largest U.S. deal volume of the year. [Read]

🏦 Missouri axes capital gains tax — The state is the first in the nation to fully exempt residents from paying capital gains tax, and policymakers are now eyeing a full income tax repeal. [Read]

🎯 Powerball jackpot rockets to $1.7B — Don’t count your millions just yet. A new breakdown shows how much winners actually keep after taxes in each state. [Read]

📉 September slump arrives — Since 1980, September is the only month with negative average stock returns. Will Wall Street’s “jinx month” live up to its reputation? [Read]

👖 American Eagle pops 38% — A viral “Great Jeans” ad starring Sydney Sweeney racked up 150M+ views, sold out fast, and drew applause and outrage from Wall Street to Washington. [Read]

🏠 Housing emergency on the horizon? — Treasury Secretary Scott Bessent hinted one may be declared this fall, sparking debate about supply, affordability, and government action. [Read]

👑 America now has over 1,100 billionaires — Most aren’t household names, and many didn’t build tech empires. Here's where they live, how they give, and what they’re worth. [Read]

🪙 Galaxy tokenizes its own stock on Solana — It’s the first SEC-registered company to trade real shares on-chain, offering a glimpse at what blockchain-based equity could look like. [Read]

ECONOMY
4. Workers Had The Upper Hand... Not Anymore 🔁

Although the unemployment rate remains at 4.2%, near historic lows, trouble is brewing beneath the surface.

For the first time since 2021, there are now more unemployed Americans than job openings.

According to the latest JOLTS report, job openings dropped to 7.18 million in July, missing economist expectations by a wide margin. That falls short of the 7.24 million unemployed Americans now looking for work.

In other words, for every job seeker, there’s less than one open position. Just a few years ago, that ratio was 2 to 1 — a worker’s paradise. Today? Not so much.

The power shift is clear:

• The quits rate is stuck near 2%, the lowest since 2016. Workers are "job hugging," clinging to the roles they have.

• The average job hunt now takes 24 weeks, nearly a month longer than last year.

• Layoffs and job cuts are slowly creeping higher.

Slower immigration may help cushion the slowdown. But AI and automation are having the opposite effect, eliminating some jobs and putting a freeze on hiring in others, particularly for new graduates.

Even the Fed seems to be shifting focus. At Jackson Hole, Chair Jerome Powell noted “the shifting balance of risks may warrant adjusting our policy stance.” Translation: the Fed is beginning to see the labor market, not inflation, as the bigger threat.

What comes next?

• Wage growth could slow as employers regain leverage.

• A rate cut is nearly certain. The CME now pegs odds of a September 17th cut at 99%, with 1-2 more by year end.

Bottom line: The job market hasn’t fallen off a cliff, but the safety net is looking thinner. The Fed is now being forced into a balancing act — less tunnel vision on inflation, and more consideration for the labor market.

STOCKS
5. Guess That Stock 🕵️‍♂️

This iconic American food giant is breaking itself in two — and not everyone’s happy about it.

Can you guess the stock?

1. Even though the stock hasn’t moved in years, it offers a juicy 6% dividend yield of 40 cents per quarter.

2. Warren Buffett owns over 25% of the company and was the architect behind its 2015 megamerger, when a processed cheese powerhouse joined forces with a condiment king.

3. That megamerger? It’s now being undone. The company is splitting into two: one for fast-growing condiments and spreads, the other for slower-moving grocery staples.

4. Its portfolio includes over 200 brands, including Velveeta, Oscar Mayer, Lunchables, Capri Sun, Philadelphia cream cheese, Classico pasta sauce, and Jell-O.

5. The company's name is a two word mash-up coming from its iconic mac and cheese brand and its best-selling ketchup label.

Got a guess? Tap here for the answer → 

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