Consumers Trade Down, Capital Freezes, Supply Chains Strain

Retail spending is up 4.9 percent year-over-year through April and consumers haven't stopped — but they've shifted toward necessities and away from discretionary categories. Small business capital investment is at its lowest level since March 2009, with only 16 percent of owners planning outlays in the next six months. And supply chain disruptions are accelerating just as pre-tariff inventory buffers run dry — 70 percent of small business owners reported disruptions in May, up sharply from April. Summer is the test.