Investors, More Than Consumers, Will Pay the Price of Tariffs

Corporations warned last week that if the Trump administration imposed tariffs on imports of steel and aluminum, consumers would pay the price. That's wishful thinking in the C-suite.

Toyota said tariffs "would substantially raise costs and therefore prices of cars and trucks sold in America." Higher costs are undebatable. But can Toyota actually raise prices? That gets to the challenge economists and markets have already been wrestling with. While some industries like housing may be well positioned to pass on cost increases, many others are not. It's plausible that higher metal costs will eat into Toyota's profits instead of driving up car prices.