📰 Economic Impact of Trump’s “Big Beautiful Bill”

Published: July 3, 2025

📘 Introduction

On July 3, 2025, the US House passed Trump’s $3.4 trillion "Big Beautiful Bill" with a strong majority. This article explores its impact on the US economy and financial markets.

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🧹 1. Bill Summary

• Permanent tax cuts from Trump’s first term
• New tax exemptions (tips, overtime)
• Massive cuts to Medicaid and SNAP
• Reduction in energy-related benefits

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💵 2. Government Debt and Treasury Bills

🔷 Debt Obligations and T-Bill Issues

• Surge in short-term T-bills
• Yield above 4%
• Panel suggests 20–25% T-bill range

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⚖️ Financial Risks

• Increased market volatility due to rate sensitivity

📊 3. Bond Yields and Monetary Policy

Heavy bond issuance pushes yields higher (10-year could reach 5%). This affects loans and mortgages, and influences Fed policies.

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👥 4. Impact on Public and Businesses

💸 Who Benefits?

• Top 20% income group receives 72% of benefits
• Lower income groups get only $6,000 relief

❌ Medicaid & SNAP Cuts

• 17+ million people affected
• Impact on rural healthcare and energy subsidies

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🛡️ 5. Risks and Market Reactions

🔍 Investor Sentiment

• Hesitancy due to rising rates
• Strong jobs data supports stock market

⚠️ Credit and Inflation Risks

• Higher rates increase borrowing costs
• Inflation fears due to uncontrolled spending

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🔚 Conclusion

The bill brings short-term gains through tax cuts but creates long-term risk through spending cuts and debt. Smart financial planning is essential for households and investors.

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