To The Moon

The Market and Fiscal Impact of U.S. Economic Policy

"Short-term and long-term effects of the "Bigger and Better Bill

1. Short-term impact: The passage of the bill will directly boost confidence in the U.S. market, enhance investor expectations through the release of policy dividends, and promote capital market activity.

2. Long-term impact: alleviate the market's concern about U.S. fiscal sustainability.The bill may optimize the efficiency of fiscal spending through structural reforms and reduce expectations of debt default risk.

Evolving trends in trade friction and corporate impact

Forecast of the pattern after the July 9 tariff war pause period

1. Policy continuity: The three-month pause period is likely to be extended, but it is difficult to see substantial improvement in the tariff structure.The United States may maintain existing trade barriers through "technical extensions".

2. Impact on business behavior: Delayed trade uncertainty will lead to continued caution in business investment.Capital expenditure plans in tariff-sensitive areas such as manufacturing and technology sectors may be further delayed.

Chain reaction of a failure to reach an agreement between China and the U.S.

1. Risk of tariff escalation: If negotiations break down, tariffs may remain high or rise further, directly impacting the global industrial chain.

2. Regional economic pressures: Asian export chains (e.g. electronics, machinery manufacturing) face greater cost pressures, and growth expectations for export-dependent economies such as Vietnam and South Korea may be revised downwards.

3. Global Confidence Shock: Normalization of trade frictions will undermine business confidence in global economic recovery, slowing down cross-border investment and supply chain restructuring.

Core findings and data summary

Summary of Key Insights

Policy recommendations and outlook

1. Firms need to keep an eye on tariff policy changes and establish multi-regional supply chain options to minimize risks.

2. Markets need to be wary of the synergies between fiscal and trade policies and avoid overly optimistic expectations for a single policy.

3. The global economic recovery process will be more reliant on policy coordination, and it will be difficult to see a comprehensive easing of trade frictions in the near term.

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