Bubble Watch: The Fed Will Give Wall Street Another $2.1 Trillion to Play With

Extreme Monetary Policy Just Got More Extreme July 30, 2020 UNSUBSCRIBE | ARCHIVES Top Futurist: “Forget 5G… buy ‘15G’ instead” With everything going on… And with the entire world causing a surge of new internet demand… Will 5G stocks explode to new highs when America reopens for business? The truth is, they could. But ask George Gilder, who’s been called “America’s #1 Futurist” and a “technology prophet”… and who’s won the ear of presidents and billionaires… what he thinks you should buy… And he’ll tell you to forget 5G… Because it’s time to load up on what he calls “15G” instead. Nobody’s talking about this. You’ll be the first to get details, at this link. Bubble Watch: The Fed Will Give Wall Street Another $2.1 Trillion to Play With Dear Money & Crisis Reader, Yesterday, the stock market roared higher when Fed Chair Jerome Powell announced… The Fed will hold rates near zero for the foreseeable future The Fed is extending its dollar repo and swap line to March 31 The Fed will continue to use its “full range” of tools to support the economy The Fed will continue to perform its QE programs at the “current pace” of $125 billion per month ($1.5 trillion per year) The economy, household spending, labor market, and business fixed investments are in various stages of recovery. Let’s provide some perspective here. Prior to its COVID-19 policy response, the Fed’s largest balance sheet expansion was $3 trillion over the course of eight years. The Fed has spent more than this in just three months. Prior to its COVID-19 policy response, the Fed’s largest QE operation was $80 billion per month. At its peak in March 2020 the Fed was spending $125 billion per day. It has now reduced this to $125 billion per month. And it intends to keep it there until there is a full recovery (which the Fed currently believes will be sometime in late 2021). So… the Fed just told the market that it intends to provide, at a minimum, $2.1 trillion in additional liquidity to the financial system over the next 18 months. In simple terms, the Fed will continue to backstop the financial system in ways that far exceed its policy response to the Great Financial Crisis of 2008. And the Fed will do this until the US has experienced a full recovery (Fed speak for “forever”). This is why the markets refuse to fall, no matter how horrible the economic data gets. This was an EXTREMELY dovish Fed FOMC announcement. It calls to mind European Central Bank (ECB) Mario Draghi’s famous claim that the ECB would do “whatever it takes” back in 2012. COVID Is No Joke: “I hear them laughing…” His NYC comedy club is STILL banned from reopening its doors — so how can he survive? “I hear them laughing… they think I’m up to my eyeballs in debt, but what they don’t know is I own this place free and clear. And I paid for it with the most powerful moneymaking secret EVERYONE should know…” Find out how this stand-up comedian is using a little-known secret to earn passive paychecks… and laughing all the way to the bank >> Extreme Monetary Policy Just Got More Extreme Indeed, the only thing hawkish you can point to from the entire Fed announcement is Fed Chair Powell’s claim that the Fed hasn’t discussed “equity buying” (buying stocks outright). However, even this is a bluff. By law, the Fed isn’t permitted to buy municipal bonds, corporate bonds, or any of the other items it is buying via its QE programs. So it signed a contract with financial firm BlackRock to perform the Fed’s current QE programs. And this explicitly states that the Fed is giving BlackRock authority to buy stocks. See for yourself: Subject to this Agreement, including the Investment Guidelines (as defined in Section 5.1), the Manager is hereby appointed as the FRBNY’s agent in fact, and it shall have full power and authority to act on behalf of the Account with respect to the purchase, sale, exchange, conversion, or other transactions in any and all stocks, bonds, other securities, or cash held for investment subject to the Agreement. Source: New York Fed Let me ask you… Why would the Fed authorize BlackRock to buy stocks if it wasn’t planning on eventually doing this? The Fed could have easily said it was authorizing BlackRock to ONLY buy ETFs, bonds, and the other investments that it is currently purchasing via the nine credit facilities it set up with the US Treasury in late March. So why include stocks… an asset class the Fed has yet to approve for ANY purchases WHAT-SO-EVER?! Because the Fed will be buying stocks at some point, most likely whenever the markets begin to break down again. Preparing to Profit… Bottom line: The Fed is backstopping EVERYTHING and will do so at a pace of $125 billion per month from now on. And if things worsen, the Fed will increase its purchases and eventually start buying stocks outright. With that in mind, the No. 1 trading strategy going forward is to get ahead of the Fed. And we've developed a proprietary options system that does precisely this. More details coming soon… Best Regards, Graham Summers Editor, Money & Crisis Former CIA and Pentagon Advisor: "Americans Should Do These 5 Things NOW" America could be facing a catastrophe that will catch most people by surprise… And no, it’s not the coronavirus. Most Americans have no idea what’s about to hit them in the coming days. Which is why Americans should take these 5 steps right now. Click here now to see the shocking details. To end your Money & Crisis e-mail subscription and associated external offers sent from Money & Crisis, click here to unsubscribe. If you are having trouble receiving your Money & Crisis subscription, you can ensure its arrival in your mailbox by whitelisting Money & Crisis. Money & Crisis is committed to protecting and respecting your privacy. Please read our Privacy Statement. Phoenix Press, a division of Laissez Faire Books, LLC. 808 Saint Paul Street, Baltimore MD 21202. Nothing in this e-mail should be considered personalized financial advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized financial advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after online publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. © 2020 Phoenix Press, a division of Laissez Faire Books, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Phoenix Press, a division of Laissez Faire Books, LLC. EMAIL REFERENCE ID: 401MNCED01