Core members of Trump's team (new finance minister and commerce minister) talked about Trump's real intention and. Recently, US Treasury Secretary Bessent and Commerce Secretary Lutnik were interviewed by the All in Podcast (crypto czar Davide Sacks is also one of the four initiators of the All in Podcast). 1. Key points of the interview with Minister of Commerce Lutnik Video link: https://youtu.be/182ckTL2KBA?si=_Jmwhq7KpneXVSB_ 1) The history of trade patterns: From 1880 to 1913, the United States did not have any income taxes (individuals and businesses did not have to pay), only tariffs. After raising funds for one stop, income tax was introduced. After World War II, the United States was the most powerful country in the world. In order to support reconstruction, it lowered its own tariffs and allowed other countries to retain high tariffs, making it the country with the lowest trade barriers in the world until now. 2) The role of tariffs: firstly, to protect domestic industries and attract the return of manufacturing; The second is to generate revenue for the country 3) How to solve the $2 trillion deficit? One is to create an additional income of one trillion yuan first. Lutnik's view is to combine tariffs, sovereign funds, and immigration. Especially the immigration gold card. In the interview, he mentioned that 1000 immigration gold cards were sold in one day, and Trump believed that 1 million people could be attracted to buy the immigration gold card. The second is that the government efficiency department will cut one trillion yuan, especially in excessively wasteful spending. Lutnik believes that 25% of current government spending is wasted, and a 25% reduction in fiscal spending totaling $6.5 trillion per year would be just over $1 trillion. 4) Regarding Tax Reduction Lutnick and Trump said that if I realized the balance of revenue and expenditure of the government, could I cancel the income tax with an annual income of less than 150000 dollars. Trump said yes. Lutnik believes that this approach is not only a tangible reduction in the burden on taxpayers, but also an economic policy incentive that can motivate more American people to work harder and drive economic growth. 2. Key points of the interview with Finance Minister Besant Video link: https://youtu.be/lSma9suyp24?si=8twRvF3xnXJ28Pv6 1) Three issues with the US economy (1) The constantly expanding government debt and fiscal deficit. Criticizing the Biden administration for excessive spending, the United States does not have a revenue problem, only a spending problem. The revenue of the US government is very healthy, but the expenditures are beyond the control of the Biden administration. In peacetime, such unrestrained stimulus and spending are unprecedented, and if this continues, the US economy will inevitably fall into the socialist bias of Europe. (2) Inflation and Distribution Issues (Social Inequality) Besent pointed out that the current economic policies have led to an increase in inflation, especially affecting the bottom 50% of wage earners the most. The actual purchasing power of these groups has decreased, while asset owners have benefited from the rise in the stock market, exacerbating social inequality. (3) The manufacturing industry in the United States is weak 2) Bessent and the Trump administration are proposing three plans: (1) Reduce government debt leverage by cutting expenses, while streamlining government personnel; (2) Readjust the international trade system, bring manufacturing jobs back to the United States, and revitalize the middle class; (3) Utilize tariffs to relocate some industries and supply chains back to the United States. 3) Regarding the Ministry of Government Efficiency and Expenditure Reduction The task of the efficiency department is to use commercial and technological means to thoroughly review government budgets, eliminate unnecessary expenditures, streamline institutions, reduce redundant positions, and thus free up at least $1 trillion in funds. Not to eliminate the government, but to make it more efficient. But it should be gradual and not drastically reduced all at once. We need to reduce debt and deficits without triggering a recession. 4) To regulate and reform taxes For a long time, there have been numerous regulatory constraints in the financial and energy industries. The government must re-examine and simplify the old regulations that constrain the development of enterprises. For example, the cancellation of supplementary leverage ratio (SLR) and other terms is expected to reduce the yield of treasury bond, thus reducing the financing costs of enterprises and enhancing market competitiveness. After relaxing regulations, the private sector can re leverage and fill the space left by the government's deleveraging. Those who lost their jobs due to government layoffs will also be absorbed by more productive private enterprises. If the requirement for supplementary leverage ratio (SLR) is lifted, US bond yields may decrease by 30 to 70 basis points, with each basis point equivalent to saving $1 billion annually. In terms of tax reform, he advocates for a thorough reform of the National Taxation Bureau, starting with efficiency and service to reduce the burden on the people. He also believes in low tax rates, simplicity, stability, and predictability 5) We should lower energy prices and continue to slow down inflation; Relaxing regulation of the financial system will help unleash the vitality of the private sector and promote economic growth. By adjusting the international trade system and utilizing tariffs, we aim to boost the manufacturing industry in the United States. 6) Long termism Now everyone only sees the negative impact of cutting expenses, but cannot see the benefits for the future. And these benefits will only become apparent after 9, 12, or even 15 months. The social security fund has a surplus of 2.7 trillion dollars, but it is actually a pile of untransferable US treasury bond bonds. Should social security funds invest in the S&P 500 index or stocks? Why not turn social security funds into sovereign wealth funds to invest in the future of all Americans? If a sovereign wealth fund can be established, and many philanthropists are paying attention to "baby bonds". If a certain investment account can be established for newborns, in parallel with social security, it can achieve compound interest growth in wealth and also play a role in security. Personal feelings: From what I can see, it was first mentioned in November last year at https:// (x.com)/qinbafrank/status/1854548480938987820? S=46&t=k6rimWsEbo2D2tXolYcM-A is similar to the analysis in February and March. Trump and his staff both think that there is a big problem in the United States, and they need to scrape the bone to cure the poison, so they have to bear the pain. The significant change in attitude towards this plan is that Besant previously called on the market to go through a detoxification period, but this time he mentioned that "we need to gradually and not drastically reduce at once. We need to reduce debt and deficits without triggering a recession," indicating a slightly slower pace. This is also why we discussed earlier that the market will experience ups and downs this year (gusts of wind), and reforms will hurt our bones: Or, the result can't be accepted by most of them, and Trump and its team can't ignore the fierce reaction of the market; Either advance three times and retreat one, sometimes with a fierce pace and sometimes slightly relaxed, and ease is easily pulled back and forth under this policy rhythm.