The U.S. needs to issue $9 trillion in new debt, with yields still high; 4.5% on the 10-year and 5% on the 30-year. While revenue is up, structural problems persist, such as fiscal expansion without printing money. The Fed can't cut rates yet, even though lower rates are needed. The immediate wins don’t solve these deeper problems. Still, the economy is showing resilience, tight labor markets and manageable inflation. If the data worsens significantly, the Fed will act. For now, patience is the best strategy. Capex remains strong, particularly in tech. Some of the pessimism might be overblown.

What’s the damage to US-China trade so far this year?

Around 30%–40% of Chinese companies rely on cheap imported components. Many are going bankrupt. There are even reports of mass protests over unpaid wages. Both sides know they can’t fully trust each other now. Supply chains are shifting, which could be beneficial long-term, but that won't happen quickly. We started the year expecting zero tariffs; now we face 30%. This is a huge burden on businesses, and the macro data will reflect it soon: higher import prices, falling demand, and pressure on small firms. Oil demand won’t rebound unless China and others increase consumption. The U.S. is now collecting higher tariffs from many countries; while it’s not the extreme 100% initially proposed, it is using this under the banner of fairer trade to boost revenue. The broader aim seems to be addressing the fiscal deficit.

How is Asia holding up through this turmoil?

The outlook is bleak. China’s currency is weak, and policymakers have little room for stimulus. They’re trying to boost domestic demand, but it's not working well. Central banks in emerging markets are easing, so liquidity is improving slightly, but we’re far from major stimulus. The weaker dollar may help U.S. firms short-term, but overall structural growth in Asia remains fragile. India and Pakistan each have unique challenges, and sovereign debt risks remain high. Trump’s proposed tax cuts may be a bullish story for next year, but with debt nearing the ceiling by August, it’s hard to see how anything major gets passed soon. Long-term strategies like reshoring jobs and using AI to reduce labor costs may help, but that’s a decade away. In the near term, uncertainty dominates, and real growth is elusive.