Postcards: Straight Cash Homie (We're Red)

Randy Moss bought his car "Straight Cash, Homie." Here's why you need to have some cash on you as the Fed meeting concludes tomorrow, and where to build your cash position. ͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­ Forwarded this email? [Subscribe here]() for more You are a free subscriber to Postcards from the Florida Republic. To upgrade to paid and receive the daily Republic Risk Letter, [subscribe here](. --------------------------------------------------------------- [Postcards: Straight Cash Homie (We're Red)]( Randy Moss bought his car "Straight Cash, Homie." Here's why you need to have some cash on you as the Fed meeting concludes tomorrow, and where to build your cash position. [Garrett {NAME}]( Apr 30   [READ IN APP](   Market Update: There is an incredible amount of chop right now. Markets are struggling, and the S&P 500 can’t break the 5,100 level - and that helped fuel a selloff in the last 30 minutes that jarred many traders. This is a concerning technical challenge, as we’re seeing a pathway possible for a MUCH lower move for all indices after the Fed’s meeting concludes. It’s been a brutal day for refineries, with the markets awash in diesel and Brent crude options expiring. Most people haven’t reported this, but it appears that the U.S. government has relicensed Russian banks for the energy sector. Makes sense… We’re now red across the board - why hide it - as I just raised the Red Flag for Republic Risk readers, and now we’re putting up the hurricane shutters for what comes next after the Fed speaks on Wednesday. Dear Fellow Expat: It won’t take long in Maryland to realize that the crabs are as stuffed with meat as the locals are with opinions. In Florida, everyone remains compliant in avoiding politics and agreement. But here I was, stepping into a Maryland bar only to find a din of opinions as rich and varied as a seafood buffet. Bargoers rabble over everything from the economic swings of the 2020s to the fastest lacrosse shots in the 1980s, from the protests at Columbia University to the swelling traffic in Columbia, Maryland. I kept my head down, avoiding any opinions on the subjects. But a voice finally called: 'Garrett, what are you up to these days?' I sidestepped economists, political risk, finance, competitive intelligence, and alternative energy like a crabber sidestepping the bay’s edge on a slippery morning. I said I was tinkering with a battery project out in Cumberland. “Oh,” the man said before turning away to a blonde. Exactly. Keep it mundane. No one launches into a heated debate over batteries. Save the good stuff for Republic Research. [Upgrade to paid]( Cash Me Out? I later talked to a friend about the market's whims and the broader economy's rumblings. The conversation didn’t devolve into high-flown rhetoric about fiscal repression or the intricacies of monetary theory—[subjects that send many in search of a dictionary]( - or worse - back to their email chain. We chatted about our favorite companies, trading insights with the casual air of connoisseurs comparing notes on wines. The chat took a turn when I said I was currently "sitting in cash." "In cash?" my friend echoed, tilting his head. What does it mean to be "in cash?" More important, why would someone like me… want to hold cash? Being "in cash" implies keeping a portion of one's portfolio in cash or cash equivalents. It’s not permanent. It’s based on having liquidity instead of tying my worth up in a sea of stocks, bonds, or other securities. One might adopt this stance during what we eloquently call 'Negative Equity Signal Events.' That’s a fancy way of saying we have a liquidity problem in the market, and stocks may sell off without warning. Cash is less volatile than other assets. Holding cash shields one's capital from potential losses during periods of market uncertainty. While inflation remains a lurking threat, nibbling away at the value of your idle dollars, cash holds a strategic advantage. It affords the agility to pounce on investment opportunities that emerge suddenly. If the market takes a nosedive or an enticing investment opportunity presents itself, having cash means you can act promptly and decisively. You're spared the messy business of having to liquidate other assets at what could be ugly times. Here in the Florida Republic, we view cash as a battery—a defensive strategy against market downturn surprises. [Upgrade to paid]( How to Be in Cash You have a handful of options when it comes to being in cash. Let’s start with my preferred avenue in Money Market Funds. These funds are a little more cultured than your traditional savings account. These funds invest in short-term, high-quality debt. They can deliver much better returns than most savings accounts and still offer liquidity similar to your bank account. You might find money market accounts today paying north of 5%. Depending on your brokerage account, your cash may reset directly into a money market fund (this is done on my Fidelity 401K account). Sometimes, however, you may only be able to exit a Money Market fund at a specific time during the day, meaning you’ll have access to your cash the next morning. If speed is of the essence, consider high-yield savings accounts, which provide a nice return via interest and the luxury of FDIC insurance. If you want quality, consider Treasury Securities, like T-Bills. These are short-term government securities that mature within a year. They’re purchased at a discount to face value and are a sterling choice for the risk-averse. Other options include short-term bond ETFs, ultra-short-term bonds with higher risk but greater return than money market funds, and certificates of deposits. In current conditions, Money Markets and their current yields are attractive enough. No matter what, don’t just let your “cash” sit in a checking account doing nothing. Money is always moving… and your money should always make you something - in return. Then, when it’s time to pounce, we’ll be ready to take action. Tomorrow, we’ll discuss the latest Fed announcement. Remember—if you’re a trader—to follow the direction of the market from 2:35 to 2:37. This market has a habit of reacting a few minutes into Powell’s speech. If this market shoots up, be very wary about a possible selloff in the final hour when institutions wrap up their day. Now… go close the storm shutters. Hurricane Jerome is fast approaching! Stay positive, Garrett {NAME} Disclaimer Nothing in this email should be considered personalized financial advice. While we may answer your general customer questions, we are not licensed under securities laws to guide your investment situation. Do not consider any communication between you and Florida Republic employees as financial advice. Under company rules, editors and writers cannot recommend their positions. The communication in this letter is for information and educational purposes unless otherwise strictly worded as a recommendation. Model portfolios are tracked to showcase a variety of academic, fundamental, and technical tools, and insight is provided to help readers gain knowledge and experience. Readers should not trade if they cannot handle a loss and should not trade more than they can afford to lose. There are large amounts of risk in the equity markets. Consider consulting with a professional before making decisions with your money.   [Like]( [Comment]( [Restack](   © 2024 Garrett {NAME} 548 Market Street PMB 72296, San Francisco, CA 94104 [Unsubscribe]() [Get the app]( writing]()