The U.S. stock market is having a terrific year. The benchmark S&P 500 ( ^GSPC +0.67% ) is up 16% in 2025 despite economic uncertainty created by President Trump's tariffs. But there could be trouble on the horizon.

A Federal Reserve study suggests tariffs will slow economic growth. That is particularly bad news because the S&P 500 currently trades at one its most expensive valuations in the past 40 years. Here are the details.

A Federal Reserve study suggests President Trump's tariffs will hurt the economy

President Trump believes tariffs will strengthen the U.S. economy, "Tariff power will bring America national security and wealth the likes of which has never been seen before," he wrote in November. However, a study from the Federal Reserve Bank of San Francisco challenge

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