BlockBeats News, July 1st, the transaction information platform Kobeissi Letter pointed out that the irony about the situation between Elon Musk and Trump is that eliminating the US fiscal deficit could actually achieve all of President Trump's economic goals in one fell swoop.
First, eliminating deficit spending would reduce the amount of national debt issued, thereby lowering the bond yield. This would also lower the inflation rate, allowing the Fed to cut interest rates and stabilize the bond market. In fact, the bond market was the reason for the turnaround in the trade war in April when the 10-year Treasury yield soared to over 4.60%. To some extent, reducing deficit spending would allow Trump to exert more tariff pressure to narrow the trade deficit. Although the trade war is seen as a "short-term pain for long-term gain," the true application of this phrase is in cutting deficit spending.
With Musk's continued public statements about the debt crisis, more and more Americans are beginning to pay attention to this issue. Since the start of stimulus measures during the 2020 pandemic, bankruptcy is the inevitable outcome on America's current fiscal path.
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