Charts Worth 1000 Words: Beautiful Act Hurts Most Americans

Is America about to tax the poor to feed the rich—and slow its own economy in the process? A striking set of financial charts reveals the troubling implications of the “Big Beautiful Act,” a plan that could shrink the wallets of most Americans while dragging GDP down. As Wall Street debates tax burdens and tech stock dominance, one thing is clear: the market is telling a deeper story. Let’s dive into the data behind the headlines.

Roughly 55% of Americans earn less than $44,200 annually, and about 65% earn less than $51,000 per year. If the “Big Beautiful Act” were implemented, the majority of Americans (those earning under $51,000 annually) would see their taxes increase and their take-home pay decline.

The poorest Americans—those earning under $17,000 a year—would be hit the hardest, with a 13.6% reduction in actual take-home income. Meanwhile, high-income earners would benefit significantly.

Seen from this angle, the “Big Beautiful Act” is an epic example of robbing the poor to enrich the wealthy.

But it’s not just a matter of wealth redistribution—it could also backfire economically, dragging down U.S. GDP growth. Goldman Sachs estimates that the positive impact of the "Big Beautiful Act" on U.S. economic growth would be smaller than the negative effect caused by new tariffs. If both the act and retaliatory tariffs were enacted simultaneously, U.S. GDP growth would decline significantly.

Now let's take a look at the "Department of Government Efficiency" under Elon Musk. It hasn’t saved much in public spending but has seriously damaged Musk’s and Tesla’s reputations. Moreover, massive layoffs hurt the broader U.S. economy.

Researchers note that cutting public non-defense R&D spending by 25% could lower U.S. GDP by about 3.81% and reduce annual fiscal revenue by approximately 4.34%—an impact comparable to a financial crisis. If cuts reach 50%, GDP would decline by 7.59%, and fiscal revenue would fall by 8.58% annually. In particular, halving the National Institutes of Health budget alone would reduce GDP by 3.65%, making it one of the most significant impacts.

Next, let’s turn to some U.S. stock market–related charts:

Goldman Sachs forecasts that the “Magnificent Seven” stocks will continue to outperform the S&P 493 in 2025. In Q1, the Magnificent Seven posted an impressive 28% year-over-year EPS growth, far exceeding the 9% for the remaining 493 S&P stocks. For the full year, Goldman expects 15% earnings growth for the Magnificent Seven versus just 4% for the others.

However, this earnings lead is gradually narrowing. By 2026, the Magnificent Seven’s projected growth drops to 15%, while the S&P 493 climbs to 13%—closing the performance gap.

Excluding the “Magnificent Seven,” European stocks have actually matched the S&P 493 in earnings growth over the past decade.

Since 1986, U.S.-listed companies in the healthcare and technology sectors have shown the strongest growth, with both annualized and median growth rates outperforming the S&P 500. In contrast, sectors like energy, utilities, and consumer discretionary have lagged significantly. This explains why most long-term outperformers in the U.S. are clustered in tech and healthcare.

Money market fund flows often serve as a key source of “buy-the-dip” ammunition for equity markets. When cash flows into money markets shrink significantly, it often indicates dip-buying activity is underway—frequently preceding a reversal in U.S. stock prices.

European equities have outperformed U.S. stocks this year. On average, 20 analysts expect the STOXX Europe 600 Index to end the year at around 554 points. JPMorgan believes the performance gap between European and U.S. equities could reach a record high.

Morgan Stanley notes that China is currently the most underweighted market among global active funds, suggesting significant room for revaluation and increased allocations. Among other emerging markets, India and Saudi Arabia are also underweighted, while Brazil and Mexico are overweighted.

Lastly, here are several other noteworthy charts:

Goldman Sachs expects a noticeable slowdown in U.S. household consumption growth over the coming months. Monthly nonfarm payroll growth is expected to fall below 100,000 in the second half of the year.

Although the U.S.-China trade situation has eased over the past three weeks, freight volume from China to the U.S. has yet to rebound and remains in decline.

Goldman also forecasts that strong central bank demand—especially from emerging markets—will continue to support gold prices. Since 2022, central bank gold purchases have surged fivefold.

In the most recent fiscal year, dividend payouts by companies in Japan’s TOPIX Index rose 15%. In addition to stock buybacks, this reflects the positive impact of Japan’s corporate governance reforms on capital markets.

Currently, U.S. data centers rely primarily on natural gas and coal for electricity. However, the International Energy Agency (IEA) projects that by 2030, renewable energy will become the dominant power source.

Finally, a long-term study of new businesses in the U.S. since 1998 shows that while over 80% of companies survive their first year, only about one-third are still operating by year seven—an average 7-year survival rate of 31.18%.

Among all industries, healthcare services exhibit the strongest resilience, with nearly 44% of firms still in operation after seven years. In contrast, the information sector sees the fastest decline, with less than a quarter surviving (24.78%). Service-oriented sectors such as healthcare and finance have higher survival rates, while tech and construction-related sectors are more prone to early failures.