US budget: "Big" but not really "Beautiful"

After three months focused daily on tariff policy, it's time for fiscal policy. Households and businesses prefer to hear that their taxes will decrease rather than increase (trade tariffs are tax increases). On fiscal matters, Donald Trump has not been able to claim full powers. Congress is at the helm. The Republican majority follows the president's directives but must also smooth over internal disagreements on how to reconcile the 'Big, Beautiful Bill' with the large imbalances of federal finances. Government deficits are set to grow (we are already starting from 7% of GDP), and debt rise (96%). The increase in long-term rates (close to 4.5%) is a reminder that bond markets may not tolerate too much fiscal slippage.