The Fed Can’t Admit This...

You are receiving this email because you signed up to receive our free e-letter the Wealth Whisperer The Fed Can’t Admit This… 07/31/2023 It’s said that when you wish upon a star with all your might, your dreams just might come true. While we’re still waiting for that McLaren to appear in the driveway, we’ll at least accept the consolation prize… Our Federal Reserve FINALLY grew a spine… or at least that’s what they want you to think… Maybe Jerome Powell [read our inflation dissection]( where we pointed out that inflation was still running hot… Maybe they looked at the sizzling economy, retail spending and still low inventory levels and said it wasn’t time to let off the brakes quite yet… Or maybe, they finally decided that subsidized risk-taking built moral hazards into capital markets… … lol… yeah right. Source: Midjourney. Look, a broken clock is right twice a day, and that’s all that’s happened here. We don’t believe that the makeup at the Fed changed overnight. All they did was send a message to markets that they were willing and able to raise interest rates or, at the very least, hold them at higher levels. Aren’t we being a bit too harsh? Absolutely not! Because they won’t admit how MASSIVE the problem is that they created. Good thing we’re not ones to shy away from the truth. Buckle up, folks, because we’re going to give the Fed an enema that shows the nasty truth they don’t want you to see. SPONSORED CONTENT [Elon Musk May Have Just Changed Everything]( Quantum computing, 3D Printing and Gene-Editing. These are three of the most disruptive pieces of technology in recent times... But none of them compare to a project Elon Musk just released... One that could soon mint the world's first trillionaire... [Learn all about it here]( [Click Here to Read More...]( Government Bails Out the Government Most of you probably know this, but the single largest holder of U.S. government debt is none other than the Federal Reserve. [Source: Peter G. Peterson Foundation]( This wasn’t always the case. Before the Great Recession, the Federal Reserve treated its balance sheet with more care. But once the flood gates opened with quantitative easing (QE) infinity… well, we’ve never looked back. The biggest jump in their balance sheet came in 2020 when that value jumped from $4 million to over $8 million. Yet, despite higher rates aimed at stifling demand, the Fed’s balance sheet remains higher than a Cheech and Chong after-party. [Source: Fed Website]( Of the $8.25 trillion they own, $2.5 trillion are mortgage-backed securities. $1.74 trillion will mature in the next one-to-five years. But a whopping $4.8 trillion doesn’t mature for 10 years or more. So, the idea that the Fed is reducing its balance sheet by cutting purchases and just letting existing holdings run off (mature) is like filling up your tank a quarter of the way for a cross-country journey. The point is their rate hikes only hurt short-term borrowers, pinching the one place more fragile than any other: business. [The Perfect Portfolio: No Losses, 14X Gains]( I want to share with you something very important… and very simple. I’m talking about a 3-stock strategy that’s been immune to market losses over the past two decades… while outperforming the S&P 500 by 1,461% during that same time. That’s no losing years plus 14X gains. I call it the “Perfect Portfolio.” [Click here now for all the details.]( [Click Here to Read More...]( Who Interest Rates Actually Hurt Most homeowners aren’t feeling the pinch either, as most mortgages issued in the last decade are 15 or 30-year fixed rates, which were locked in during happier times. [That’s why we suggested 20% interest rates were a possibility in our newsletter back in early May.]( That’s not to say that current homebuyers aren’t paying through the nose. However, as the data above highlights, they could and should be paying a lot more if the Fed would only sell off some of its longer-dated assets. Instead, they’re screwing around with short-term interest rates in the one-to-five-year camp. Those of you who run a business probably have experience with this: businesses don’t borrow money like homeowners do. Our government subsidizes homeowner loans with FHA Freddie and Fannie loans. Businesses get the shaft, with most taking on variable rate loans in the one-to-five-year camp. [In one of our recent newsletters]( we explained the ticking timebomb underlying commercial loans, especially those for empty office buildings. How bad has it gotten? Take a look at the rates on new term loans from the Kansas Federal Reserve: [Source: Kansas City Fed]( The median back during the pandemic was 1.16%. Before the pandemic, it averaged around 5-5.5%. Unlike homeowners who aren’t going to need to recoup their loans, these commercial rolls will happen in the next 12-36 months, with many facing >100% interest rate increases. How long do you think Bidenomics will help our economy then? [What To Do With Your Trades Now]( Would you rather read the news, or get a jump start on the markets by predicting trends up to 72 hours ahead with up to 87.4% proven accuracy? The future is here, and it wants a piece. [Join the Training on A.I. 101 Live Session for Free.]( [Click Here to Read More...]( Preparing for the Inevitable The massive rate distortion has left most investors reeling. Many are skittish about putting money into the markets right now, and rightfully so. That’s why it’s more important than ever to build a retirement blueprint to defend your nest egg and maximize every available resource. No one knows how to do this better than Bob Carlson, a RETIREMENT EXPERT trusted by folks for more than three decades. He’s served on the Board of Trustees of the Fairfax County Employees’ Retirement System since 1992 and is the editor of the award-winning [Retirement Watch](. In his latest book, Bob lays out seven “end-around” strategies you can use to protect your retirement from a new law enacted by Congress that could… no joke… effectively CUT 30% OR MORE value off your IRAs, 401ks, and even your pensions. [Click Here to Find Out How to Save Your Retirement!]( To Your Wealth, The Wealth Whisperer Team About Us: Eagle Financial Publications is located in Washington, D.C. – only a few blocks from the Capitol. Our products have been helping investors build their wealth for several decades. Whether you’re a long-term investor or short-term trader, you’ll find the right strategy for you, including how to earn more steady income to spend now, preserve and grow your capital to enjoy later, and whatever other investment goals you have. 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