Amid the surge in AI advancements, Wedbush analyst Dan Ives has emerged as a leading advocate on Wall Street, presenting an unwaveringly optimistic perspective on how this technology might ignite a Fourth Industrial Revolution.
However, as circumstances evolve, so do people.
In a recent client memo, Ives raised concerns about the current tech market, as the implications of Trump’s unexpected tariff declaration continue to resonate within the investment community.
“Reviving 1980s manufacturing practices through these tariffs is a misguided endeavor that, in our opinion, could lead to economic disaster and undermine the tech sector, the AI Revolution narrative, and the broader industry,” stated Ives.
Discover more: The impact of Trump’s tariffs on the economy and your finances
The manner in which Trump and his administration plan to rejuvenate US manufacturing is set to be a long-standing topic of discussion within economic policy circles.
As this protracted process unfolds, American consumers are expected to experience rapid and significant shifts in the prices of certain products. Recent discussions around inflation have highlighted commodities like eggs, with Wall Street analysts suggesting that inflation rates could potentially double this year due to Trump’s initiatives.
Yet, Ives has provided a more direct and perhaps more concrete warning regarding the impact of these tariffs on consumers: The price of an iPhone could soar.
“The economic repercussions of these tariffs are difficult to articulate and could set the US tech industry back a decade while allowing China to advance,” Ives commented.
“Tariffs of 50% on China and 32% on Taiwan would effectively seal off the US tech landscape, resulting in electronics prices spiking by 40%-50% for consumers, with iPhones produced in the US potentially costing $3,500 (up from $1,000), and the progress of the AI Revolution would be considerably hampered by these perplexing tariffs that must be re-negotiated to more feasible levels.” (Emphasis added.)
Ives also pointed out an issue noted by Nick Colas at DataTrek, highlighting a disconnect between the timelines of US politics and Trump’s manufacturing goals.
“Shifting production back to the US will take many years, but American voters have elections every two years for Congress and every four years for the presidency,” Colas wrote.
“If the newly introduced trade policies trigger a recession and lead to rising inflation, voters will certainly remember the lingering effects, especially come 2028,” he added.
