The name "Beautiful Great Act" sounds like it’s not about making Beautiful Country beautiful again; the important thing is the votes. It’s still going through the process. Washington is about to spend money again.
Currently, we are in a state of high inflation and locked in high interest rates. The Federal Reserve dares not cut interest rates, while keeping a nervous eye on the size of the deficit.
On the fiscal side, there could be another "turning on the tap," with comprehensive stimulus from climate, AI infrastructure, healthcare to supply chain security.
Is this a structural rebalancing, or a disguised form of "fiscal easing"?
• Hedge funds focus on "asset prices rising first, then talking"
• The bond market is more concerned about "deficit sustainability and rising long-term interest rates"
• BTC, gold, and tech stocks may once again initiate the "anti-inflation game"
If the stimulus is effective, what will happen when inflation rises? If the stimulus is ineffective, how will the debt snowball roll?
The U.S. economy now seems to be stabilized by fiscal measures and expectations,
but this gamble, in the end, someone will have to foot the bill.
As shown in the figure, it displays the "U.S. Fiscal Deficit vs. CPI vs. 10-Year U.S. Treasury Yield" three-line chart. Slightly rough, but viewable
