Tariffs continue to rattle investors, yet they didn’t factor into my 2026 stock forecast. Why? Consider the “four e’s” – expectations, exemptions, evasion, and enforceability. They ensure the ups and downs of President Trump’s current and future levies pose more economic bark than bite.

To be sure, tariffs are always bad – especially for the country imposing them. US stocks’ serious lag versus world stocks in 2025 was partly because of that. Trump’s newer blanket 10% global trade taxes imposed (after the Supreme Court killed his “Liberation Day” tariffs) aren’t good. Nor is his threat to raise that to 15%, or to squash the US-UK trade deal, or the 50% duty he threatened on China.

But for stocks, surprises matter most. Tariff turmoil is now old news, baked into expectations … and into stock prices. That is a 180-degree turn from last April, when the breadth, magnitude and sheer weirdness of Liberation Day duties startled the market. Stocks swooned, pre-pricing worst-case scenarios of retaliation and trade devastation — all overdone for all the reasons I detailed last May.

Global trade grew 3.4% in 2025. Even Chinese exports – directly in Trump’s crosshairs – rose 5.5% overall despite US-bound shipments plunging. Stocks rebounded big time. But how?

Consider the second “e” – exemptions. For all of Trump’s talk, over half of all US imports were duty free before the Supreme Court ruling. Smartphones and semiconductor chips? Exempt. Many pharmaceuticals? Exempt. Nickel, tin, LEDs, coffee, beef, bananas? All eventually exempted after backlash. His new 10% global levy includes slightly more exemptions.

For tariffed items, evasion was easy – so-called “transshipping” to a lower-tariffed intermediate hub, for example. Consider: China’s exports to southeast Asian economies boomed. In parallel, America’s 2025 imports from ASEAN nations leapt 29%. Coincidence? No – transshipping! Mind you, shadier, even illegal shirking techniques also have proven to be popular.

Fourth, enforcement obstacles are overwhelming. When Liberation Day hit, America’s Customs and Border Protection agency (CBP) had only about 2,500 tariff employees to monitor hundreds of entry locations. Hiring and training processes are hugely arduous. No surprise then that in fiscal 2025, CBP performed an amazingly minuscule 465 audits … for over 50 million inbound shipments!

Fact: The globalized world can’t unwind fast. Few products come wholly from one nation. If a good is designed in the US, built in Vietnam with German machinery and parts from 20 different countries, what is the nation of origin? What tariff rate applies?

All this makes tariffs’ reality far less injurious than feared. Consider: In April 2025, the World Bank estimated US tariff rates averaged 28%. Its January update cut that to 17%. Actual 2025 US tariff rates really averaged slightly less than 10% of imports’ prices. February’s court ruling lowers that to about 8%. If Trump pushes his new global tariff to the 15% legal limit, effective tariffs would rise back to 10% – if they survive more lawsuits, that is. Not good, but far better than feared.

Dealmaking helps mitigate tariffs’ global economic effects. Trump loves haggling, often using tariff threats to negotiate new deals like those the US struck with Taiwan, China, Japan, the UK, India (not yet inked) and more. His tariff targets also found partners elsewhere: the EU struck deals with Britain, India, Mercosur and others. The UK and India made their own pact. Expect more agreements.

Hence the huge tariff hit many feared (and some wrongheadedly cheered) wasn’t just delayed. It isn’t coming. The “four e’s” ensure that. Stocks fathomed all this quickly last year when few did and moved on. You should, too.

Ken Fisher is the founder and executive chairman of Fisher Investments, a four-time New York Times bestselling author, and regular columnist in 21 countries globally.