Core Viewpoint - The article discusses the potential economic outlook for the U.S. under a "big fiscal + loose monetary" policy framework, suggesting that inflation may be used to manage the national debt, contingent on a compliant Federal Reserve that supports low interest rates [1][8]. Group 1: Debt and Fiscal Policy - The U.S. federal debt has surged to nearly $30 trillion, up from $17 trillion in 2019, marking an increase of $12 trillion [2]. - Interest payments on this debt have risen from 2.4% of the debt balance in 2019 to 3.6% currently, making interest payments the second-largest expenditure in the federal budget [4][2]. - The estimated fiscal deficit for 2024 is projected at $1.1 trillion, nearly equal to the $0.9 trillion in interest payments, indicating a significant strain on other budgetary allocations [4]. Group 2: Revenue and Expenditure Adjustments - A hypothetical reduction in interest rates from 3.6% to 2.5% could save approximately $650 billion in federal funds, which could offset the anticipated annual deficits of $500-600 billion starting in 2026 [6][8]. - Increasing tariffs from around 2.5% to 12.5% could generate an additional $300 billion in revenue annually, further contributing to fiscal stability [6][8]. Group 3: Stock Market and Economic Indicators - The article highlights that the U.S. stock market is facing challenges, particularly with high valuations and the potential for a liquidity crunch as the Treasury seeks to rebuild its cash reserves [13][19]. - The upcoming earnings season is critical, especially for tech stocks with significant overseas revenue, as a weaker dollar could enhance their earnings by approximately 3% [15][19]. - The article warns that without unexpected interest rate cuts from the Federal Reserve, the stock market may experience stagnation or decline due to high valuations and potential liquidity issues [19]. Group 4: Portfolio Performance - The Alpha Dolphin virtual portfolio has underperformed compared to major indices, with a total return of 91.3% since inception, significantly outperforming MSCI China by 88.2% [21][24]. - Recent performance was impacted by declines in major holdings such as TSMC and NetEase, with adjustments planned based on upcoming earnings reports and debt issuance impacts [23][24]. Group 5: Upcoming Events - The article outlines key earnings reports to watch, including ASML, TSMC, and Netflix, emphasizing the importance of their performance and guidance for the semiconductor and subscription sectors [27][28].