Trump calls for an order, especially macro uncertainty. Last night, Trump again called for a confidence boost in the reserve market, which is a shot in the arm. We should once again feel the impact of policy uncertainty on the market. On the 23rd, I talked to my friends about the market and they were all waiting for a rebound. However, the US stock market's stagflation trading has begun, and there may be a wave of clearing first. Last week, there was a short-term release of risks. However, it also depends on whether macro uncertainty can gradually be resolved in the future. 1. Tariff issues The repeated impact of the current tariff issue is the greatest, as tariffs have raised market inflation expectations, while also undermining consumer confidence and the confidence of small and medium-sized enterprises, delaying consumption and investment decisions. Trump also repeated this. Trump announced these tariff measures earlier this month, but later reached an agreement with the leaders of both countries to postpone the implementation date by one month in exchange for stricter border control measures. This extension will expire next week. However, later that day, Trump also announced that tariffs on Mexico and Canada would take effect on April 2nd. But last week, a reporter asked if Trump plans to officially implement a 25% tariff on Canada and Mexico on March 4th. Trump said, 'I won't stop tariffs' There is also the implementation of equivalent tariffs in early April. The next time for tariffs is tomorrow and early April. Over the weekend, Mexico proposed to levy tariffs on China together with Canada in exchange for Trump's tariff exemption. Let's see if Trump will accept that if the tariffs on Mexico and Canada are not settled or postponed tomorrow, the market sentiment will be eased in the short term. After that, it's early April 2. Economic data The service industry PMI, which fell below the boom bust line as expected on the 21st, has greatly increased market expectations of stagflation and panic. With last week's stagflation trading underway, the market's expectations for the Fed's interest rate cuts this year have actually increased, which can be understood as the weakening of the economy. Everyone hopes that the Fed will come out to rescue the market. The focus is on this week's non farm payroll and next week's CPI, and the biggest highlight here is: 1) The Ministry of Government Efficiency has implemented drastic layoffs, and has now laid off 30000 people and bought out over 70000 (those who bought out will continue to receive six months' salary). There is also the expulsion of illegal immigrants, as in the past two years, the majority of the new non farm employment in the United States has been provided by part-time workers from illegal immigrants. With the implementation of layoffs (planned to cut 500000 people) and the deepening of the expulsion of illegal immigrants, will there be a decrease in employment and an increase in unemployment rate (of course, this may not be reflected immediately in February, but will be reflected gradually in subsequent months). 2) The weakening of the service industry is actually beneficial for the decline of inflation, after all, the most stubborn inflation now is the super core inflation highly related to the service industry. Is March inflation crucial? Will it continue the upward rebound trend of the past few months, or will it let the market determine that the weakening of the economy has already pushed inflation downward? 3. The Federal Reserve's Policy The interest rate decision in mid to late March, how does the Federal Reserve, which is currently on a pause in interest rate cuts, view the current uncertainty and economic weakness, as well as the pace of stopping balance sheet tightening in the future (considering stopping balance sheet tightening in the semi annual monetary policy report in February when the debt ceiling is reached and re issuing bonds is considered). Based on current economic data and market trends, there is a high probability that a rate cut and suspension of the Federal Reserve in March will prevent a rapid short-term reversal. However, it can be expected that Powell's statement will not be so firm. Whether there will be any surprises in the special dot plot and economic forecast compared to December, we can see the attitude of the Federal Reserve governors. 4. Tax reduction policy Personally, I am more optimistic about the budget bill that includes tax reduction policies. Last week, the House of Representatives passed the first version of the budget bill, but the Senate's own plan differs significantly from the House, and the mediation between the two houses is still ongoing. This game still needs some time to proceed, and if it is implemented, it should have a significant boost to the economy. As above, it is good for Trump to call for orders, but it is not appropriate for FOMO to chase high. The premise for the continuous entry of large funds is that macro and policy uncertainties will continue to be eliminated, otherwise it will be more of an emotional stimulus.