Trump recently promised that if the Republican Party wins both chambers of Congress,
to give every adult U.S. citizen $5,000!
Roughly speaking, it’s about 1.2 trillion dollars!
Can this money really be distributed?
If it’s actually paid out, how much would flow into the stock market and the crypto market?
Will this trigger a new bull market breakout? Keep watching!
A repeat of the 21-year bull run?
from the end of March 2020 to November 2021.
Bitcoin rose from around $6,000 to nearly $69,000—up more than 10 times.
One of the key drivers of that rally was the US “massive handout,”
During the pandemic, the US provided three rounds of direct cash support totaling about $814 billion.
Of course, it also layers on near-zero interest rates and large-scale monetary easing—so you can’t estimate the rise just by the amount of cash distributed.
And this time, subsidy expectations reach $1.2 trillion. If it’s delivered, that’s about 1.47 times the scale at the time!
As everyone knows, Americans don’t save much money—once they get it, they spend it!
Besides consumption, paying down debt, and saving, it also means heading to the trading market and going all in!
A foreseeable path is that U.S. stocks strengthen, the earnings/wealth effect recovers, and capital gradually flows out into crypto.
Whether the money can be issued depends first on November 3.
Next, focus on the U.S. midterm elections.
This election mainly determines congressional seats. If the Republicans win both the House and the Senate at the same time, it will be easier for the strongman to push through a new fiscal policy.
If they lose either chamber, Democrats will have more opportunities to block his bills and spending plans.
According to Polymarket data, the market-implied probability that the Republicans win both chambers is only 7%.
• Democrats win both chambers, 65%
• Republicans win the Senate and Democrats win the House, 28%
• Republicans win both chambers, 7%
For the strongman, this election is very important.
Subsidy promises, policy adjustments, and campaign mobilization could all affect the election results. But whether these actions can actually translate into votes depends on whether voters buy into them.
Moreover, winning both chambers doesn’t automatically mean subsidies will definitely be delivered. The sources of funding, the specific plans, and the approval arrangements still need to be clarified. Large-scale spending could also push up inflation and interest rates, which would weigh on performance of risk assets.
What could possibly change the election outcome?
First, the cost of living and employment.
Whether food, rent, gasoline, and electricity are expensive; whether wages can keep up with prices; whether jobs are easy to find—these directly affect how voters feel. Pew’s survey shows that economic issues are the top topics voters most want congressional candidates to discuss.
Second, war, oil prices, and foreign relations.
Whether conflicts can de-escalate and whether energy prices can fall will affect household spending and voters’ evaluations of the government. Recent reporting also points out that the energy-price pressure caused by the war is already influencing election prospects.
Put simply, it’s changes in diplomacy—can they make Americans’ lives a bit better?
So what’s related to everyday life? It’s basically the prices of staples—firewood, rice, cooking oil, and salt.
Third, healthcare, immigration, and tax policies.
These policies affect the immediate interests of different groups. Whether subsidy promises can boost approval ratings also depends on whether voters believe they will actually be fulfilled.
Fourth, key districts and voter turnout.
National approval ratings only show the general direction; the final seats depend on the specific districts. Candidate performance, independent voters’ choices, and which side is more willing to turn out and vote are all worth tracking.
So what do we do next?
Can the Republicans win both chambers → can subsidies be implemented → does the money actually flow into the market
If the probability of a Republican win keeps rising and there are real policy breakthroughs, I’ll consider adding positions in batches.
If expectations weaken, I’ll correspondingly reduce my position.
In the near term, I’m focusing on research into this midterm election, with my positioning moving along with changes in policy and funding.