The Fed's BIG Bluff... Part 3

Here’s what you can expect before the $#!^ hits the fan… June 30, 2021 UNSUBSCRIBE | ARCHIVES The Fed's BIG Bluff... Part 3 IMPORTANT UPDATE FROM JAMES ALTUCHER The media will blame the volatile markets on anything from the coronavirus to the election… But something more sinister is causing them to swing up and down… One former hedge fund manager claims it has everything to do with the computers on Wall Street… He explains everything in his short video here. Dear Money & Crisis Reader, Over the last two days, I’ve been outlining how the Fed “spooked” the bond markets into believing it will move to crush inflation sometime in the next 18 months. By quick way of review: The Fed did NOT actually taper its Quantitative Easing (QE) program. The Fed did NOT actually raise rates. The Fed issued a verbal intervention to force bond yields lower. The Fed has clearly decided it is willing to stomach higher inflation in the near-term to sustain the bubble in stocks and economic recovery. So, it doesn’t actually want to curb inflation as in the actual rise in the cost of living for Americans. No, all the Fed wants is to make the long-term bond markets believe that it will move to stop inflation sometime in the future. Why Does the Fed Want to Do This? Because long-term bond yields represent the “growth expectations” against which stocks are priced. Put simply, if long-term Treasury yields are higher, say at 5%, then stocks would tend to be priced lower, at roughly 15 times earnings. But if long-term Treasury yields are priced much LOWER, 2% for instance, then stocks will be priced at higher multiples, like 22 times earnings. July 14th: America’s Financial Extinction Event? The election is over… The corrupt media declared Joe Biden the winner… And that bad news is about to get a whole lot worse… Because the prophetic analyst who predicted the subprime mortgage meltdown… the financial crisis of 2008… and Brexit… Just issued another shocking prediction… If you and your family are not prepared for what he says is coming your way on July 14th… You need to take action now. Click here for the full details. With that in mind, take a look at what long-term Treasury yields have been doing in the last year (red parabola). The yield on the 30-year U.S. Treasury more than doubled from 1.2% to 2.4% from August 2020 to March 2021. Now look at what the yield on the 30-year U.S. Treasury has done since the Fed release last week (blue square). Talk about a reversal! With Treasury yields falling again, this opens the door to stocks being valued in bubble-territory. As economist Edward Yardeni has noted, at 22 times forward earnings, the S&P 500 would be priced around 4,500 by year-end. Things could go even crazier from there. Provided there isn’t some black swan event, if yields on the long-term Treasury continue to fall to new lows (say 1.5%), this would allow for stocks to go into true “looney tune” bubble territory. We’re talking 5,000 and higher in the S&P 500. Even if we don’t see stocks get to that height, the door is open to a spectacular crash all based on the Fed’s bluff. I’ll explain why in tomorrow’s article. Until then… Best Regards, Graham Summers Editor, Money & Crisis America’s FINAL Wealth Transfer Thanks to a recent drastic decision made behind closed doors in this building on March 23rd, 2020 at 8 A.M… …Millions of Americans will likely fall into poverty in the coming months… In what historians will call the end of America’s middle class. Click here to find out the 5-steps to take immediately to protect & grow your wealth. To end your Money & Crisis e-mail subscription and associated external offers sent from Money & Crisis, feel free to click here. 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. For any further comments or concerns please email us at MoneyAndCrisis@threefounderspublishing.com. 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. © 2021 Three Founders Publishing, LLC., 808 Saint Paul Street, Baltimore MD 21202. 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 Three Founders Publishing, LLC. EMAIL REFERENCE ID: 401MNCED01