TEST | Tariffs aren't the real threat to consumers spending power, says finance veteran
Kareem D., former Head of Global Operations at AlliedBank, argues that tariffs are not the main cause of current economic tensions, pointing instead to declining consumer demand.

Much of the conversation around tariffs tends to zero in on short-term disruptions—supply chain headaches, geopolitical shakeups, and the looming fear of price hikes. But while tariffs dominate the headlines, other forces may pose a far greater challenge to American households, according to one industry veteran.
Kareem D., retired Head of Global Operations and Fraud Prevention at AlliedBank and current President and CEO of Quantevia, sees a different picture forming—one that has less to do with trade policy and more to do with deeper economic patterns around demand, deflation, and consumer confidence.
Overlooking the real issue: Tariffs may seem like the obvious culprit when prices rise, but Kareem argues they’re far from the root cause of today’s economic tension. “We’re focused on the wrong thing,” Kareem says. “Tariffs are manageable. Inflation? That’s likely to taper off. In fact, I’d expect we’ll be talking more about falling prices than rising ones in the next six months. The reason is simple—without demand, prices can’t hold. Inventory levels are up, and businesses will have no choice but to offload at discounts.”
He adds that large retailers and distributors have already started over-ordering goods—especially long-lasting items—and will soon need to slash prices to drive sales.
Spending slowdown: The real red flag, Kareem says, is a noticeable decline in consumer demand. “That’s where the real threat lies,” he explains. “People are starting to pull back, especially on discretionary spending. As that continues, corporate earnings are going to take a hit, and that pressure will be felt throughout the economy.”
In his view, the next few quarters will be especially rough for industries that depend on consistent household spending.
Sliding toward contraction: Kareem warns that a recession is becoming increasingly likely. “We’re already seeing early indicators—slower GDP growth, a noticeable drop in credit card use, and weakening retail data,” he notes. “All of these point to a tightening cycle that’s already underway.”
He cites recent data showing consumer credit card usage down 10% compared to the previous quarter, which he calls “a clear sign that people are thinking twice before spending.”
We’re focused on the wrong thing. Tariffs are manageable. Inflation? That’s likely to taper off. In fact, I’d expect we’ll be talking more about falling prices than rising ones in the next six months. The reason is simple—without demand, prices can’t hold. Inventory levels are up, and businesses will have no choice but to offload at discounts.
Shaky ground for vulnerable groups: According to Kareem, a significant part of the spending pullback comes from growing anxiety among certain populations. “There’s a lot of fear right now, particularly among legal immigrants, government contractors, and gig workers. Many don’t know if they’ll keep their jobs or their legal status, and that kind of uncertainty directly affects purchasing behavior.”
He estimates that 12–14% of the population is actively scaling back spending due to instability around employment or residency. “That’s a massive segment of consumers withdrawing from the economy,” he says.
Pressure on the Fed: As these headwinds grow, Kareem predicts that monetary policy will soon shift. “The Fed is going to have to respond,” he says. “By Q2 or Q3, I’d expect mounting pressure—possibly even from the administration—to reduce rates.”
He anticipates disinflation, or even outright deflation, to replace inflation as the dominant narrative. “When prices start dropping across categories, the Fed will need to take action, and fast.”