Which is US’s Top Import Partner for its States

Trump’s Tariffs which has been paused for Canada & Mexico for next 30 days (as of today) will have a significant impact on costs of goods purchased by American people. Tariffs, essentially taxes on imported goods, often lead to increased costs for domestic importers, which are typically passed on to consumers through higher prices. Canada, being a top import partner for 23 U.S. States whereas together, Mexico, Canada, and China are the top trade partners for 42 states. The northern U.S. is dominated by Canada, which is the largest supplier of grain, livestock, meat, and poultry to the U.S.

Meanwhile, Mexico is the top import partner for 10 states, predominantly in the South. The country is the largest supplier of fruits and vegetables to the United States. Forty percent of Texas’s imports come from Mexico. U.S. trade with these two neighboring countries also involves machinery, vehicles, oil, and petroleum products. In total, the U.S. imports about $900 billion in goods from Canada and Mexico annually.

China is the top trading partner for nine states, including California and Florida, two of the largest economies in the country. About a quarter of all imports to California come from China, totaling $113 billion per year. Economists estimate that such tariffs could increase inflation by 0.6% and reduce U.S. GDP by $200 billion. Consumers, especially those in low-income households, are likely to feel the most significant impact due to these price increases.

On the other hand, China has also announced a series of countermeasures. These include the initiation of an antitrust investigation into Alphabet Inc.'s Google and the imposition of tariffs on select U.S. goods.

The State Administration for Market Regulation (SAMR), China's antitrust authority, has launched a formal investigation into Google for alleged monopolistic practices. In addition to the Google probe, China's Ministry of Finance has announced new tariffs on U.S. imports. Effective February 10, these include a 15% tariff on coal and liquefied natural gas, and a 10% tariff on crude oil, agricultural machinery, and certain vehicles. These actions are seen as direct responses to the U.S. tariffs and are likely to escalate trade tensions between the two nations.

StableCoins PMF in Emerging Markets

Stablecoins are rapidly gaining traction in emerging markets, driven by real-world utility rather than speculation. This $205 billion market is transforming cross-border payments and financial services in developing economies, offering solutions to long-standing challenges. Starlink's Stablecoin Solution SpaceX's Starlink, now operating in over 100 countries, faced significant hurdles in accepting payments from developing markets due to unreliable banking infrastructure. To overcome this, SpaceX partnered with Bridge, a stablecoin payments platform, enabling the company to accept various currencies and instantly convert them to stablecoins for its global treasury. This move not only solved Starlink's payment issues but also positioned Bridge as a viable alternative to traditional correspondent banks in emerging markets.

Expanding Use Cases

While cross-border payments and remittances have driven initial adoption, stablecoins are now finding applications in:

1. Consumer Finance: Nubank in Brazil introduced a 4% annual return on USDC holdings, with 30% of its users now holding USDC1.

2. Global Payroll: Startups like Rise are using stablecoins to pay international contractors, avoiding currency volatility1.

3. Retail Transactions: Cashnote.io is testing stablecoin-based point-of-sale systems in the UAE

As stablecoins continue to prove their value in emerging markets, they are poised to become a core part of the global financial infrastructure, potentially standing alongside or even replacing traditional financial systems in certain scenarios in the near future

The American Express Money Machine

American Express’ Record Year Fueled by Fees and Debt America’s deep-rooted reliance on credit cards continues to pay dividends—at least for American Express. Last Friday, the financial giant reported its strongest year on record in 2024, with revenue climbing 9% to $65.9 billion. This surge translated into a staggering $10.1 billion in net profit, marking a 21% increase from the previous year.

As expected, merchant fees—what businesses pay every time an Amex card is used—remained the company’s largest revenue driver. However, the company’s recent success isn’t just about increased spending. The real boost has come from two key areas: a record-breaking number of new card sign-ups and a growing pile of unpaid balances.

A Booming Business in Card Fees 
American Express saw a sharp rise in card membership fees last year, raking in an unprecedented $8.4 billion—a 16% jump from 2023 and more than double what it earned in 2019. Customers were willing to shell out hundreds of dollars for the prestige of owning an Amex Gold, Platinum, or the ultra-exclusive Centurion (Black) card. Even with frequent fee hikes, demand remained strong, with a record 13 million new cards issued in 2023. It’s not just high-net-worth individuals driving this trend. Younger consumers—particularly Gen Z and millennials—accounted for 75% of new Platinum and Gold card sign-ups last year. These flashy metal cards have become a status symbol, allowing cardholders to showcase their ability to afford steep annual fees—$695 for Platinum and $325 for Gold—while enjoying premium perks like airport lounge access, travel credits, and fine dining benefits.

Over the past decade, the average annual fee per card has more than doubled, from $40 in 2014 to $103 in 2024. With a growing number of customers willing to pay these higher fees, it’s no surprise that Amex stock has surged 59% over the past year, propelling the 174-year-old company to new financial heights. But the Real Moneymaker is the Interest Income for the business.

While affluent cardholders bring in steady revenue, what’s driving American Express’ top-line growth even more is the rising number of customers carrying unpaid balances. In 2024, the company generated $15.5 billion in net interest income—a significant 18% increase from the prior year—as more cardholders struggled to pay off their monthly bills.

The Swipe-and-Struggle Economy
Yet, for many Americans, financial strain is worsening. According to Wells Fargo, "credit reliance is up, and savings rates are down," a trend expected to continue in 2025. While American Express continues to profit from its lucrative credit card business, the growing debt burden on everyday consumers highlights a sobering reality.

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