[Altos Trading Newsletter] Why American Banks are Bleeding Deposits...Details Inside

Hello Traders! We hope you find this weekly FREE newsletter filled with information that helps your trading day! Today we talk about the moves that the Fed could make...and how they will affect you as an investor.... And we talk about the possibility of Former President Trump getting indicted and how it affects a certain stock. Plus...where is the money going? We talk about the slow bleed of US Bank accounts and what happens next! Thanks for reading! The Team at Altos Trading VIDEO - NEW STRATEGY Revealed: Wall Street’s “Crash-Tested” Income Technique Everyday Americans need extra income like never before. And one former Wall Street fund manager is revealing the “crash-tested” strategy he uses to target an extra five percent each week... [GET THE FREE TRAINING]( SPONSOR ⬆️ US ECONOMY A Pivotal Moment for the Federal Reserve Today is a big day for the Federal Reserve as they face one of the most challenging policy decisions in years. The question at hand is whether they should raise interest rates again to combat high inflation or keep them steady amidst the most severe banking crisis since 2008. Federal officials will release new interest-rate projections, and Fed Chair Jerome Powell will answer reporters' questions shortly after. Interest-rate futures markets predict a quarter-point increase, indicating a roughly 5 in 6 chance of a rate rise. Despite previous attempts to telegraph rate moves, the Fed faces a fluid crisis on the eve of the policy meeting. There are arguments for both raising rates and holding steady. Before the collapse of Silicon Valley Bank two weeks ago, officials were debating whether to raise rates by a quarter-point or a half-point due to signs that the economy was running too hot. Since officials met on Jan. 31-Feb. 1, the economy has shown surprising strength in hiring, spending, and inflation. This has led to concerns that aggressive rate rises over the previous year haven't done enough to slow the economy and corral inflation. Some economists argue that stopping rate increases now risks fueling unacceptable risks that inflation will stay higher for longer. On the other hand, the banking turmoil creates risks of even more rapid tightening in financial conditions. Lenders will face increased scrutiny from bank supervisors and from their own management teams to reduce risk-taking. In addition, banks could see their earnings squeezed if they feel pressure to raise deposit rates, which could further crimp lending. Even if all of the risks of further bank runs have been eliminated, banks' "funding costs are going up, and they're going to be worrying about the regulatory response to this," said former Fed governor Jeremy Stein. Economists at Goldman Sachs estimate that the incremental tightening in lending standards that could result from stress at small and midsize banks would be equivalent to a quarter or half-point increase in the Fed's benchmark rate. Jan Hatzius, Goldman's chief economist, said he expected the Fed not to raise rates this week because tightening too little would be an easier problem to fix than tightening too much. "Inflation is really an issue monetary policy addresses over a one-to-two-year horizon," said Mr. Hatzius. "Waiting six weeks probably doesn't make a meaningful difference to the inflation outlook." It will be interesting to see how the Fed officials will provide more nuance about how their economic forecasts have shifted, how the risks around them have changed, and what that means for the likely path of rates. In December, most officials believed that they would raise the fed-funds rate to around 5.1% this year, and their Feb. 1 policy statement suggested "ongoing increases" would be appropriate. How officials describe the most likely path could be as important as their actual decision. Despite the uncertainty, Fed officials have recognized the risks of simultaneously fighting inflation and financial instability. Several officials have stated that they would use emergency lending tools to stabilize a shaky financial sector so that they can continue to use higher interest rates to cool inflation. Over the past two weeks, the Fed, working with the Treasury Department, banking regulators, and global central bankers, has deployed several emergency lending tools. In conclusion, the decision the Fed makes today will have significant implications for the U.S. economy and the global financial markets. The world will be watching closely as they decide whether to raise interest rates or keep them steady during this tumultuous time. CLICK HERE ⬆️ INVESTOR NEWS Trump's Arrest Looming: How Will it Impact DWAC Stock and the Trump Brand? DWAC's future hinges on the value and credibility of the Trump brand as it plans to take Trump Media and Technology Group public through a reverse merger. The stock has seen increased volume but a 7.8% decrease in March. The possibility of Trump's indictment, specifically regarding his payout to Stormy Daniels, has raised concerns about the Trump brand's future and its impact on DWAC's plans. The company has already delayed a shareholder vote six times and warned investors it could potentially cease operations without the deadline extension. The success of DWAC's plans is linked to the success and credibility of the Trump brand, subject to potential volatility as the indictment looms. Nevertheless, the reverse merger plan reflects a broader trend of SPACs investing in technology for growth and innovation, The Slow Bleed of Deposits in American Banks: What's Happening and Why? Deposits in American banks have fallen by nearly 3% in the past year, making the financial system more fragile. Money-market funds, which invest in short-term debt, have seen inflows as deposits leave banks. However, the Federal Reserve's reverse-repo facility, designed to aid its exit from low rates, may be destabilizing banks. The use of the facility has jumped due to vast quantitative easing during the pandemic, leaving banks laden with cash. The Fed's easing of the Supplementary Leverage Ratio at the start of the pandemic allowed banks to increase their holdings of Treasury bonds and cash. But in March 2021, the Fed let the exemption lapse, leading banks to cut their borrowing from money-market funds and park cash at the Fed. Money-market funds could become "narrow banks," backing deposits with central-bank reserves. The rise of new channels for deposit outflows requires regulators to be more vigilant than ever before in mitigating potential risks. A similar concern has been raised about opening the Fed's balance sheet to money-market funds. During a financial crisis, it could exacerbate instability with funds running out of riskier assets and onto the Fed’s balance sheet. For now, the banking system is dealing with a slow bleed. However, deposits are growing scarcer as the system is squeezed, and America’s small and mid-sized banks could pay the price. The situation highlights the need for regulators to carefully monitor the effects of monetary policy and ensure that financial innovation does not destabilize the banking system. The rise of new channels for deposit outflows requires regulators to be more vigilant than ever before in understanding and mitigating potential risks. 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Subscribers to Altos Trading or any other persons who buy, sell or hold securities should do so with caution and consult with a broker or investment adviser before doing so. Trading securities and options involves risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade securities and options, and must meet suitability requirements. Past results are not necessarily indicative of future performance. Performance figures are based on actual recommendations. Due to the time critical nature of trading, brokerage fees, and the activity of other subscribers, there is no guarantee that subscribers will mirror the performance of the service. Performance numbers shown are based on trades subscribers could enter based on the trade alerts. Altos Trading, LLC assumes no responsibility for any losses incurred by any individual or entity as a result of trade alerts or strategies taught through courses or coaching services. 7154 W State Street Suite 169 Boise Idaho 83714 USA Disclaimer: The Altos Trading Alert Newsletter is published as an information service for subscribers, and it includes opinions as to buying, selling and holding various stocks and other securities. However, the publishers of the Altos Trading Alert Newsletter are not brokers or investment advisers, and do not provide investment advice or recommendations directed to any particular subscriber or in view of the particular circumstances of any particular person. Altos Trading, including its owner, does not participate in any trades issued through the alert services. Subscribers to Altos Trading or any other persons who buy, sell or hold securities should do so with caution and consult with a broker or investment adviser before doing so. Trading securities and options involves risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade securities and options, and must meet suitability requirements. Past results are not necessarily indicative of future performance. Performance figures are based on actual recommendations. Due to the time critical nature of trading, brokerage fees, and the activity of other subscribers, there is no guarantee that subscribers will mirror the performance of the service. Performance numbers shown are based on trades subscribers could enter based on the trade alerts. Altos Trading, LLC assumes no responsibility for any losses incurred by any individual or entity as a result of trade alerts or strategies taught through courses or coaching services. 7154 W State Street Suite 169 Boise Idaho 83714 USA [Unsubscribe]( | [Change Subscriber Options](