The Bank Crisis Changed Things for the Fed

What the Fed did and said today... The recent bank crisis changed things... One rate hike today, maybe one more, and that's it... More advice from 'Doc' Eifrig... A 'reversal window' may be opening... The wealthiest 1% are making this move... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] What the Fed did and said today... The recent bank crisis changed things... One rate hike today, maybe one more, and that's it... More advice from 'Doc' Eifrig... A 'reversal window' may be opening... The wealthiest 1% are making this move... --------------------------------------------------------------- We're almost done... This was the message out of the Federal Reserve today when discussing its interest-rate-hike run and fighting inflation... Coming out of its most recent policy meeting today, the central bank announced another 25-basis-point (0.25%) rate hike to a target range of 4.75% to 5%. Meanwhile, its quarterly economic projections suggested perhaps only one more increase to come. That means a "pause" in rate hikes could be ahead in the next few months... Before the recent banking crisis, traders were increasingly betting on a 50-basis-point (0.5%) rate hike today... and perhaps more into the summer. But after the run on Silicon Valley Bank, the consensus expectation among bond traders fell and was in line with what the Fed announced. Wall Street analysts were also expecting Federal Reserve Chair Jerome Powell to toe the line in his post-meeting press conference between fighting inflation and committing the central bank to stabilizing the banking system, if needed – like it just did 10 days ago. That happened too... Then there was the forecasting... To me (Corey McLaughlin), the question was what the Fed would publish in its Summary of Economic Projections ("SEP")... This document gives insight into the central bank's thinking about where the economy is headed. Investors care a lot about these projections given their influence on market conditions, even when they're wrong (which they have been consistently for two years, at least). Today was time for another round of guessing... Fed members projected a median real gross domestic product ("GDP") change of 0.4% this year... an unemployment rate at 4.5%... core PCE inflation of 3.6%... and a federal-funds rate around 5% (though some members expect higher). That's pretty close to what they expected three months ago... In December, the Fed was projecting real GDP growth of 0.5% in 2023... the unemployment rate to rise to 4.6%... and core inflation to be 3.5%. Most of the Fed's voting members expected the benchmark fed-funds rate to hit a minimum of 5%. All the numbers in December were trending toward the "keep fighting inflation and the economy will slow down" plan. [As I wrote in December]( they were a little bit worse than what the Fed had projected the three months prior. That's not the case now. The Fed is saying to expect "more of the same," meaning some economic slowing, and that the additional rate hikes many were expecting a month ago probably aren't going to happen... And then, perhaps, the Fed will stop hiking rates after its next meeting in early May. The most interesting thing we heard... Following the release of all that information, Powell stepped up to a podium and answered questions from financial reporters. In his remarks, he pinned the Fed's changing guidance on the banking crisis... The recent turmoil is "likely to result in tighter credit conditions for households and businesses, which would in turn affect economic outcomes." But at what level, the Fed isn't sure. So Powell said... As a result, we no longer state that we anticipate that ongoing rate increases will be appropriate to quell inflation. Instead, we now anticipate that some additional policy firming may be appropriate. He later clarified that "policy firming" refers to the Fed's policy rate, nothing else... He also said the Fed considered not raising rates at all, but that it will also keep trimming its balance sheet because data suggest disinflation is happening... just not fast enough. A healthy reminder... Finally, remember, it might also be a good idea to take all of today's Fed messaging with a healthy dose of skepticism. Remember, things can change significantly – even sometimes within a few days of Powell speaking... Before today, Powell hadn't spoken publicly since his March 7 and 8 testimonies before Congress. Back then – which really wasn't that long ago – he suggested more rate hikes could be coming and gave zero indication of what was to happen before the end of the week... On March 9, the run on Silicon Valley Bank began. The failure of the 16th-largest bank in the United States raised contagion fears in the banking system... A few days after that, the Fed created $25 billion in lending to banks to tamp down more turmoil. [As we wrote yesterday]( that move – a short-term Band-Aid – likely won't help the inflation fight... That was the backdrop heading into today. So, just know to not take Powell’s words as definitive. The market seems uncertain about the message, too. At first, stock prices did not react much to what Powell was saying, even rising a bit as he spoke. But then the benchmark S&P 500 Index sold off into the close to finish down 1.6%. For more analysis on the market action today and to get a morning market preview tomorrow, be sure to check out [our free Stansberry NewsWire service](. And I will have some more on the Fed in tomorrow evening's Digest, as well. Moving on to some more guidance from our resident 'Doc'... Last week, I shared some recent advice that our colleague Dr. David "Doc" Eifrig published in his free Health & Wealth Bulletin about one way to handle this fearful market and the stresses of daily life in general. In brief, Doc urged readers get up and move more. It's not the type of stuff you find in most financial newsletters... Specifically, he advised readers to add roughly 20 minutes of aerobic exercise to their daily routine, in part because it can regulate the "fear center" of our brains... plus provide a host of other health benefits. We received some positive feedback on sharing [Doc's thoughts on the subject](. Today, we're going to close things out by sharing some of Doc's outlook on today's markets... For those who don't know, Doc is a rare breed. He spent a decade on Wall Street as a professional trader for banks including Goldman Sachs (GS). He then went to medical school, and now, in addition to publishing his newsletters and research, he owns a wine business. He sees things from a variety of perspectives and has an expertise that many investing minds simply don't. Tens of thousands of Doc's subscribers over the past decades can attest to his outlook always being one to consider. And right now, to cut through all the noise and fearmongering out there right now, Doc says you should... Follow the money... Inflation, Fed jabbering, and a bank crisis have sparked a whole new round of stock market volatility. That makes Doc's current view especially timely. As he wrote in [a recent special report for his Retirement Millionaire subscribers](... Ignore the day-to-day headlines. They are meant to scare you. Instead, follow the money. When you do this today, you might be surprised by what you find. As Doc explains in a brand-new presentation... despite what you might hear from the Fed or famous money managers on television... institutional investors are actually starting to move cash into the markets. And this is a big signal worth watching. As [Doc wrote last Thursday in the Health & Wealth Bulletin](... The fact is, thanks to a shift coming to the stock market, enormous amounts of money will be made by Wall Street and these hedge-fund billionaires in the coming weeks and months. Obviously, Doc says he can't tell you how high stocks will soar. And we're sure to hit a few bumps in the road and corrections along the way. But this shift could make many folks far richer. And Doc can tell you exactly where you should put your money to take advantage... Doc says there's one big reason institutional investors are returning... The markets are approaching a "reversal window" where we will see opportunities to build our wealth... Prior instances throughout history have seen massive gains, but most everyday investors have missed out... and most will be caught off guard again. You see, despite all the volatility we've seen lately, "markets have proven resilient." The S&P 500 Index is 12% off its October low – a big signal to Doc. Folks are starting to believe in stocks again. The setup, he told Retirement Millionaire subscribers, could lead to a big rally... Higher stock prices have tempted more buyers, pushing prices even higher. And that makes even more folks want to buy. With so much cash sitting on the sidelines, stocks can rocket higher in no time at all. Current conditions suggest this upcoming reversal window may be one of the greatest in history, Doc says. It's likely one of the last for people over 50 years old. You'll hear all the details [in Doc's latest message](... You'll also hear a limited-time offer to access Doc's work for as little as $49... including a full 30-day money-back guarantee if you're not happy for any reason. It's a risk-free offer that we urge you to consider... Join thousands of people who already follow Doc's research and see the damning evidence in his new video that Wall Street and the mass media will never openly report. Short on time? Move through this critical warning at your own pace by reading through the transcript. [Click here to get all the details right now](. And Stansberry Alliance members and existing Retirement Millionaire subscribers, be sure to check out this latest research, already available to you, including a pair of brand-new special reports [here]( and [here](. Bank Runs: You Need Gold, Bitcoin to Exit System "What has really been exposed is the fragility of the financial system," says Simon Dixon, CEO and co-founder of BnkToTheFuture.com. We have now all seen what happens "when you try to reverse any centrally planned, low-interest-rate, central-bank-subsidized stock market." And he explains why you need to own gold and bitcoin to exit the system... [Click here]( to watch this video right now. For more free video content, [subscribe to our Stansberry Research YouTube channel](... and don't forget to follow us on [Facebook]( [Instagram]( [LinkedIn]( and [Twitter](. --------------------------------------------------------------- Recommended Links: # [Marc Chaikin Predicted the Recent Bank Run, and You'll Be Surprised by What He Says Comes Next]( On March 28, Wall Street legend Marc Chaikin is stepping forward to show you the ONE thing he believes you need to do this year to be on the right side of history. He used the same idea to make huge profits for his clients in the 1970s – a period much like today. Now, he says you could use it to make bigger gains with his Power Gauge than anything he has ever shared before. [See the details and a free recommendation here](. --------------------------------------------------------------- # [Pentagon Consultant: Here's How Biden Wins Landslide Reelection]( A forensic accountant who consults for the U.S. Pentagon, FBI, and Marines says a surprising July 25 "twist" could make many Americans vastly wealthier... but also hand Joe Biden a landslide reelection win. The full story, including four steps you can take to protect your money, is [detailed here](. --------------------------------------------------------------- New 52-week highs (as of 3/21/23): Aehr Test Systems (AEHR), inTEST (INTT), Novo Nordisk (NVO), and Flutter Entertainment (PDYPY). In today's mailbag, feedback on [yesterday's Digest]( about the "RV indicator"... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com. "Great article regarding the RV indicator. I thought I would bring back the indicator of all Fed Chairs except this one... the box indicator. I have been in this industry for more than 40 years and have seen a few up and down economies during that time. What I learned and just about every Fed Chair has, is that everything comes in a box. Hell, we even go out in one! "Our industry started to falter at the end of May last year. This was a very simple thing to figure out. The U.S. economy began to shift from stuff (everything comes in a box) to services. We thought the '22 Christmas season was going to be a boomer like '21 so we ordered big and early so we wouldn't miss what was to be a giant Christmas season. Unfortunately, China had its first shut down in the very first three months of '22 and goods sat at port or in factories for three months. "Then the flow began, and the U.S. got in its inventory in August... We blew through it by discounting as much of it as possible, yet we still will have too much and by April the wrong inventory for another three months. Remember we also went from stuff to services. So we will chew through this bulge by somewhere around the end of June, and our economy will have to start bringing in or building more stuff to sell for the summer season and definitely Christmas all over again. "If 'Transitory Powell' would have at least been watching the box business he could have pumped the breaks a bit earlier and not thrown ourselves into a ditch because according to the box business we are in a ditch. This wonderful industry will lead the economy out as it always does. Maybe this time around all the owners of box companies will begin to pick up a Winnebago." – Paid-up subscriber Greg T. "Not mentioned [in the RV article] is that the largest customers are recently retired. We are at the end of the Boomers generation and there are not as many following." – Paid-up subscriber Richard K. Corey McLaughlin comment: Good point. That's another reason the unemployment rate in Elkhart County, Indiana is relevant... It also is at least a partial indicator of the influence of the demographic trends on the country, in addition to the impacts of inflation, interest rates, demand, pandemic lockdowns, and the government-stimulated boom of late 2020 and 2021. All the best, Corey McLaughlin Baltimore, Maryland March 22, 2023 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 988.1% Retirement Millionaire Doc MSFT Microsoft 02/10/12 850.0% Stansberry's Investment Advisory Porter ADP Automatic Data 10/09/08 784.0% Extreme Value Ferris ETH/USD Ethereum 02/21/20 628.6% Stansberry Innovations Report Wade HSY Hershey 12/07/07 585.7% Stansberry's Investment Advisory Porter WRB W.R. Berkley 03/16/12 551.1% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 438.7% Retirement Millionaire Doc AFG American Financial 10/12/12 412.9% Stansberry's Investment Advisory Porter ALS-T Altius Minerals 02/16/09 320.4% Extreme Value Ferris FSMEX Fidelity Sel Med 09/03/08 306.8% Retirement Millionaire Doc Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 4 Stansberry's Investment Advisory Porter 3 Retirement Millionaire Doc 2 Extreme Value Ferris 1 Stansberry Innovations Report Wade --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst ETH/USD Ethereum 12/07/18 1,418.7% Crypto Capital Wade ONE-USD Harmony 12/16/19 1,184.9% Crypto Capital Wade POLY/USD Polymath 05/19/20 1,051.3% Crypto Capital Wade MATIC/USD Polygon 02/25/21 934.6% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 649.0% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root Rite Aid 8.5% bond 4.97 years 773% True Income Williams ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. 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