Tax Policy - The "One Big Beautiful Bill Act" (OBBBA) permanently lowers the corporate tax rate to 20% and extends R&D expense deductions and equipment depreciation benefits [2] - The standard deduction for personal income tax is increased to $1,500 for married couples filing jointly, and the tip tax and overtime tax exemptions are restored until 2028 [2] - The estate and gift tax exemption limits are raised, reducing the tax burden on high-income families [2] Social Welfare - Medicaid eligibility is tightened, requiring unemployed adults to complete 80 hours of work or community service monthly, expected to cut $1 trillion in spending over 10 years, affecting 11.8 million people [3] - The Supplemental Nutrition Assistance Program (SNAP) expands work requirements, leading to a reduction of approximately $186 billion in spending, impacting over 40 million low-income individuals [3] - Clean energy subsidies are eliminated, including the $7,500 tax credit for electric vehicles, and support for wind and solar projects is gradually terminated, shifting focus to fossil fuels [3] Defense and Border Security - The defense budget is increased by $150 billion, focusing on shipbuilding, missile defense systems, and nuclear deterrence [4] - Over $160 billion is allocated for border security, including funding for border wall construction and immigration enforcement [4] Debt Ceiling Adjustment - The federal debt ceiling is raised from $36.1 trillion to $41.1 trillion, allowing for deficit expansion over the next decade [5] Economic Impact - The OBBBA is projected to increase the federal deficit by approximately $3.4 trillion over the next 10 years, with the debt-to-GDP ratio rising from 117% to 130% [14] - Interest payments are expected to surge to $2.2 trillion by 2034, consuming 5.3% of GDP and squeezing funding for education and research [14] Industry and Market Impact - The elimination of electric vehicle subsidies poses a direct threat to companies like Tesla, potentially impacting sales and revenue, while traditional energy and defense sectors may benefit from the bill's provisions [19] - The bill's focus on fossil fuels and military spending is likely to support the traditional energy market while creating challenges for the renewable energy sector [19] Commodity Market Reactions - The increase in fiscal deficit and debt-to-GDP ratio is expected to drive up gold prices, with historical data indicating a 15% average annual increase when debt-to-GDP exceeds 120% [25] - The termination of electric vehicle tax credits may lead to increased gasoline consumption, providing short-term support for WTI oil prices [26] - The reduction of clean energy subsidies is anticipated to benefit traditional energy prices, which may indirectly support prices of vegetable oils through biodiesel [27] - Industrial metals are expected to see increased demand due to anticipated inflation and a weaker dollar, with copper prices nearing $10,000 per ton [28]