Tariffs Ineffective Against US Trade Deficit? & Family Feud Over Reese’s Recipe

What It Covers

Morning Brew Daily covers the US trade deficit reaching $901.5 billion annually despite Trump's tariff regime raising average rates from 2.6% to 13%, plus Hershey's recipe controversy, Etsy selling Depop to eBay for $1.2 billion, Amazon surpassing Walmart in revenue, and rising elite lawyer billing rates.

Key Questions Answered

• •Tariff Burden Distribution: A New York Federal Reserve study found 90% of Trump's tariff costs fall on US companies and consumers, not foreign exporters. JPMorgan data shows mid-sized US businesses with $10M–$1B revenue saw tariff costs triple in one year, directly contradicting the administration's claim that trading partners absorb these costs.
• •Trade Deficit Workaround: Importers neutralized tariff pressure through three mechanisms: rerouting supply chains from China (down 30%) to Mexico and Vietnam, exploiting tariff exemptions on high-volume categories like pharmaceuticals and electronics, and front-loading inventory before Liberation Day. The physical goods deficit still grew 6% inflation-adjusted despite a 13% average tariff rate.
• •Resale Market Timing: eBay acquired Depop from Etsy for $1.2 billion to capture Gen Z buyers — 90% of Depop's 7 million users are under 34. Resale marketplaces are expanding due to squeezed household incomes, anti-fast-fashion sentiment, and sustainability concerns, making secondhand retail a mainstream rather than niche retail channel.
• •Amazon vs. Walmart Revenue Reality: Amazon reported $717 billion in 2025 revenue versus Walmart's $713 billion, but removing AWS cloud computing reduces Amazon's figure to $588 billion — well below Walmart. Amazon's revenue grew 12.4% annually versus Walmart's 4.7%, yet Amazon shares are down 10% year-to-date while Walmart gained 14%.
• •Chocolate Labeling Standards: FDA regulations require milk chocolate to contain at least 10% chocolate liquor, 12% milk solids, and 3.39% milk fat. Consumers can verify product reformulation by checking whether packaging still lists "milk chocolate" — Rolo, Mr. Goodbar, and Almond Joy have quietly dropped that designation, signaling ingredient changes Hershey publicly downplays.