Is it 6 trillion or 10 trillion? The market can only wait for clear news; until then, everyone is just guessing. Here is a repost of a short article:

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【Expectations for China's Market Rescue Policy】Today is the last day of the Standing Committee of the National People's Congress, and the highly anticipated incremental fiscal policy will be announced during the trading session (at the latest during the evening news broadcast, which will be reflected in the US stock market). Currently, there are two major expectations in the market:

(1) Incremental fiscal stimulus plan: The market expects 6 trillion (2 trillion per year), and anything exceeding 6 trillion would be considered above expectations. Yesterday, foreign media raised the expectation to 12 trillion, which raises suspicions of maliciously inflating expectations. We estimate the scale will be around 9 trillion, with 3 trillion per year. If we consider this year as the first year, it would mean a one-time incremental stimulus of 6 trillion, which is still very encouraging. Of course, besides the total amount, the specific direction is also crucial. We believe the current goal is to address the wage performance distribution of non-provincial direct agencies and to settle accounts receivable between state-owned and private enterprises. According to some rough estimates, the gap in this area is currently around 12 trillion, of which 1 trillion is the annual increase, and 11 trillion is the stock. Therefore, 2 trillion per year would be too little, with half used to address the annual gap and the other half for debt reduction, which is less than 10%. Of course, if it really is 6 trillion, the market may decline.

(2) Other incremental policies: 1 trillion for the banking sector, 1 trillion for social security and maternity subsidies, and 3-5 trillion for real estate to ensure delivery. It is highly likely that only the banking sector will see action this time, while the other two will have to wait until the National People's Congress in March next year.

From the current policy directions of various ministries, the key to this market rescue is the "debt reduction" of local governments. Various issues faced by local governments, including the explosive growth of non-tax revenue and the significant increase in "offshore fishing" this year, are all due to a lack of funds. According to ancient Chinese disaster relief methods, officials and soldiers must first be well-fed. Now, the financial health of local governments is essential for the socialist system to leverage its advantages.

The "market rescue" here does not refer to the stock market, but to the real economy and confidence. The current situation is certainly better than before; we are no longer just discussing whether it is 6 trillion or 9 trillion. There are expectations, specific numbers, concrete methods, and clear directions. Even if the market declines today due to temporary underperformance against expectations, there is no need to worry too much, as December still has the early month's Standing Committee of the Political Bureau and the Central Economic Work Conference in the middle of the month.