I'm Buying this Stock like CRAZY after new CPI Inflation Data

Summary

The Federal Reserve's recent announcement, holding interest rates steady for now, hints at a possible cut in the near future, potentially impacting the stock market significantly. With inflation showing signs of progress, the Fed is closely monitoring economic indicators before making a move. Meanwhile, the real estate sector, particularly REITs, is expected to soar if rates are reduced, offering high dividends for passive income seekers. The video also discusses the current economic climate, including bankruptcy rates and living costs in the U.S.

Takeaways

• 📉 The Federal Reserve has announced that it will hold interest rates steady for the rest of the year, but hints at a potential rate cut in the future.
• 📈 Recent CPI data suggests that inflation has decreased, aligning more closely with the Fed's 2% inflation target compared to its peak of around 9% in the summer of 2022.
• 🏦 A significant number of companies have filed for bankruptcy this year, exceeding numbers seen even during the pandemic in 2020 and setting a 13-year high.
• 💡 Elon Musk's statement that America is heading towards bankruptcy, along with other economic indicators, suggests a challenging economic climate.
• 🏠 A large percentage of Americans feel that the United States is too expensive to live in, as reported by USA Today.
• 📊 The Federal Reserve's decision to keep rates unchanged is based on signs of progress towards their inflation objective, but they require greater confidence before cutting rates.
• 📉 The Fed rate has a direct impact on other economic indicators such as CPI and personal consumption expenditures, which have started to fall as the Fed rate has been increased.
• 💼 The sponsor of the video, Land of Land, promotes vacant land as a diversified investment to spread risk and hedge against market volatility.
• 🏢 The speaker predicts that real estate, particularly REITs (Real Estate Investment Trusts), will benefit significantly from a decrease in Fed rates, due to their high dividends and passive income potential.
• 💰 The potential for a rate cut could make real estate investments more attractive, as lower rates reduce borrowing costs and potentially increase property values and rental yields.
• 📅 The Federal Reserve's next meeting in September is a key date to watch for any changes in policy rates, as it may indicate the start of a rate cut cycle.

Q & A

What was the main announcement made by the Federal Reserve regarding interest rates?

The Federal Reserve announced that it is holding interest rates steady for a full year, with no immediate plans to cut rates.

What is the current benchmark rate set by the Federal Reserve?

The benchmark rate has remained at a 23-year high, although the exact figure is not specified in the transcript.

What economic indicator is the Federal Reserve primarily focused on when considering interest rate adjustments?

The Federal Reserve is primarily focused on the progress towards its 2% inflation objective when considering interest rate adjustments.

How has the inflation rate changed recently according to the Federal Reserve's announcement?

The inflation rate has come down closer to around 3% from its peak of about 9% in the summer of 2022.

What is the significance of the Federal Reserve's statement about the economy making progress towards its inflation objective?

The statement signifies that the Federal Reserve sees signs of progress in controlling inflation, which could lead to a potential interest rate cut in the future.

What is the current economic situation in the United States as described in the script?

The script describes a challenging economic situation with high inflation, numerous companies filing for bankruptcy, and concerns about the cost of living in the United States.

What is the potential impact of the Federal Reserve's decision on the stock market, particularly on one specific stock category?

The decision could lead to a significant increase in the stock market, particularly in the real estate sector, as lower interest rates can boost investment in this area.

What is a REIT and how does it relate to the Federal Reserve's interest rate decisions?

A REIT (Real Estate Investment Trust) is a company that allows individuals to invest in real estate without needing large sums of money. It is expected to benefit from the Federal Reserve's interest rate decisions, as lower rates can increase the attractiveness of REITs due to their high dividends.

What is the potential return on investment for investing in REITs, as mentioned in the script?

The script mentions that some REITs can offer dividends as high as 7% to 15%, providing significant passive income for investors.

What is the sponsor of the video and what do they offer?

The sponsor is 'Land of Land', which is described as America's Premier Land wholesaler, offering the opportunity to invest in vacant land and potentially build a house.

What is the advice given for potential investors looking to benefit from the Federal Reserve's interest rate decisions?

The advice is to consider investing in REITs or other real estate assets, as these are expected to perform well if the Federal Reserve cuts interest rates.

Outlines

00:00

📈 Market Impact of CPI Data and Fed Rate Decision

The Federal Reserve's announcement of steady interest rates has significant implications for the stock market, particularly for a category expected to surge soon. Despite recent signs of reduced inflation, the Fed is closely monitoring economic indicators beyond inflation, such as the chaotic political events involving former President Donald Trump and President Biden, as well as the alarming bankruptcy rates. The Fed's decision to hold rates steady is juxtaposed with the expectation of a forthcoming rate cut, hinted at by the committee's acknowledgment of progress towards the 2% inflation target. The current inflation rate is around 3%, a considerable drop from the peak of 9% in summer 2022. The summary of economic indicators suggests that a rate cut could be imminent, potentially benefiting certain stock categories, especially those related to real estate.

05:00

🏢 Real Estate Investment Opportunities Amidst Fed Rate Changes

Investing in real estate, particularly through Real Estate Investment Trusts (REITs), offers a robust strategy for generating passive income with high dividends. The video discusses the potential of REITs to provide substantial returns, with some offering dividends as high as 15%, which could replace a full-time income for many investors. The Federal Reserve's indication that a rate cut could be on the horizon in the next few meetings, possibly as soon as September, suggests that now is an opportune time to invest in REITs and other real estate assets. The video also mentions the importance of the totality of data and evolving outlook in the Fed's decision-making process, emphasizing a data-dependent rather than data-point dependent approach to future policy rate adjustments.

Keywords

💡CPI data

CPI stands for Consumer Price Index, which measures the average change in prices paid by consumers for a basket of goods and services. In the video, the CPI data is highlighted as a significant economic indicator that can influence the Federal Reserve's decisions on interest rates. The script mentions that the new CPI data announcement was made by Fed chair Jerome Powell, indicating its importance in the current economic climate.

💡Inflation

Inflation refers to the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. The video discusses the recent trend of inflation dying down, which is a positive sign for the economy as it indicates that the cost of living may be stabilizing. The script also contrasts the current inflation rate of around 3% with its peak of about 9% in the summer of 2022.

💡Federal Reserve

The Federal Reserve, often referred to as the Fed, is the central banking system of the United States. It plays a crucial role in setting monetary policy, including interest rates. The video script discusses the Fed's announcement to hold interest rates steady and hints at a potential rate cut in the future, which is a key decision affecting the economy and investment strategies.

💡Interest rates

Interest rates are the cost of borrowing money and are set by central banks like the Federal Reserve. The script mentions that the Fed is holding interest rates steady for a full year at a 23-year high but is considering a cut, which is significant for investors as it can affect the cost of borrowing and the return on investments.

💡Economic indicators

Economic indicators are statistics that inform about the economic condition of a country or region. In the video, the script refers to various indicators such as CPI, core CPI, and the personal consumption expenditures index, which are used to gauge inflation and economic health. These indicators are crucial for understanding the Fed's decisions on interest rates.

💡Real Estate Investing

Real estate investing involves the purchase, ownership, management, rental, or sale of real estate for profit. The video suggests that a category of stocks related to real estate is expected to 'explode' due to the potential decrease in interest rates, as lower rates can make borrowing cheaper and stimulate investment in the real estate market.

💡REITs

REIT stands for Real Estate Investment Trust, which is a company that owns, operates, or finances income-producing real estate. The script highlights REITs as a favorite investment option due to their high dividends, allowing investors to earn passive income from real estate without the need for large upfront capital.

💡Passive income

Passive income refers to earnings that come from a rental property, dividend, interest, or other sources that require little to no effort by the recipient to maintain. The video discusses the potential of REITs to generate significant passive income, which can replace a full-time job for some investors.

💡Bankruptcy

Bankruptcy is a legal status where a person or other entity is unable to repay the debts they owe to creditors. The script mentions that 356 companies have filed for bankruptcy this year, which is higher than during the pandemic in 2020, indicating economic distress and a potential impact on the stock market.

💡Portfolio diversification

Portfolio diversification is a strategy that involves spreading investments across various financial instruments, industries, and other categories to manage risk. The video script introduces the idea of investing in vacant land as a way to diversify one's portfolio and hedge against market volatility.

💡Land of Land

Land of Land is mentioned in the video as America's Premier Land wholesaler, offering a streamlined process for buying land remotely. The script promotes it as an option for portfolio diversification and for individuals to buy land to build their dream homes, emphasizing the limited nature of land as a resource.

Highlights

The Federal Reserve has announced it is holding interest rates steady for a full year, with the benchmark rate remaining at a 23-year high.

The Fed hints at a possible interest rate cut in the future, but not at the current meeting.

Recent progress has been made towards the Fed's 2% inflation objective, with inflation rates coming down to around 3% from a peak of 9% in summer 2022.

The Federal Reserve is not ready to reduce the target range for interest rates until it gains greater confidence in inflation stability.

Inflation indicators such as CPI, core CPI, and the personal consumption expenditures index have been affected by the Fed rate adjustments.

The expectation is that if inflation continues to decrease, the Fed rates will be cut soon, potentially leading to continued cuts over the next year or two.

A specific stock category related to real estate investing is predicted to significantly increase due to the potential Fed rate cut.

REITs (Real Estate Investment Trusts) are highlighted as a favorite investment option due to their high dividends and passive income potential.

The sponsor, Land of Land, is introduced as America's Premier Land wholesaler, offering an alternative investment in vacant land.

Land investments can help diversify portfolios and hedge against market volatility due to land being a limited resource.

A discount code is provided for Land of Land's auction, offering a $300 reduction on the total invoice for successful land purchases.

The video includes a discussion on the potential for living off passive income through investments like REITs, which can offer dividends of up to 15%.

A link to a video on the top five REITs for the next year is provided for further investment guidance.

The Federal Reserve's decision-making process is described as data dependent but not data point dependent, focusing on the totality of data and evolving outlook.

The Fed is closely monitoring the economy's movement towards a point where reducing the policy rate would be appropriate, considering inflation and labor market stability.

A potential rate cut could be on the table as early as the next meeting in September if the economy meets the Fed's confidence test.

The current decision not to cut rates is attributed to the Fed not yet being at the point of confidence needed for a reduction in policy rates.

Transcripts

the new CPI data announcement has just

come in Via Fed chair Jerome Powell and

this was a very big announcement this

one stock category in the stock market

is going to explode in the very near

future now we heard earlier this month

that inflation has died down a bit so

there was no surprise there but we also

have heard that inflation is not the

only metric tied to the decisions

affecting the Fed rate the United States

has been through some craziness over the

last week or two with former president

Donald Trump being shot and current

president presid Biden pulling out of

the next presidential race Elon Musk

says that America is heading towards

bankruptcy 356 companies have filed for

bankruptcy this year higher than in the

pandemic in 2020 and is higher than any

comparable figure in the last 13 years

52% of Americans said the United States

is too expensive to live in per USA

Today at least the announcement today

was a bit more favorable than all that

it's important to keep all of this into

consideration when we're looking for the

next great investment start this hour

with that breaking news on the economy

it's news that could have big impacts on

your wallet the Federal Reserve just

announced it is holding interest rates

steady for a full year now The Benchmark

rate has remained at a 23-year high but

the FED is hinting more than ever that a

cut could be coming soon just not today

joining us now with the very latest is

NBC News business and data correspondent

Brian Chong so Brian this is not a major

surprise right you have been sitting

here telling us for month months that an

interest rate might happen in September

I don't think you ever said in July is

that still the thinking yeah and by the

way that next meeting is going to be the

next time we'll get a decision so it

seems like yeah it might not be long

from now that we'll get that interest

rate cut but again on the calendar we're

going to be looking at at least another

6 to eight weeks to get that now when it

comes to the announcement that just

dropped about 2 minutes ago the Federal

Reserve saying that it has not ra rather

has not cut interest rates it's keeping

interest rates where they are right now

but that they've seen some signs of

progress so I'll you exactly what they

said quote in recent months there has

been some further progress towards the

committee's 2% inflation objective and

the reason why I bring that up is

because that's been the big story in

this economy the high price tags that

we've all been noticing at the store now

the Federal Reserve has said all right

well with the rate of inflation coming

down to somewhere closer to around 3% as

of some recent measures again compare

that to about 9% in the peak of the

summer of 2022 that is good progress but

the Federal Reserve has been saying why

has inflation been going sideways it's

been seemingly hovering around down 3%

for basically the entirety of 2024 there

have been other readings that have been

more encouraging to them this statement

that they just released seems to codify

that but again they're saying very

clearly that the committee does not

expect it will be appropriate to reduce

the target range AKA a cut until it has

gained greater confidence can they get

that by September that's what we're

going to be watching for now very

important is to look at the rate and

inflation chart we can see that CPI core

CPI and the personal consumption

expenditures index all went out of whack

making inflation sore through the roof

then that black line is the Fed rate and

you can see that once we raise that rate

eventually all those other lines started

to fall and as the Fed rate increased

and stayed increased those other numbers

dropped and are approaching that dotted

orange line which is the Fed inflation

Target since we're heading toward that

dotted line consistently for months now

we can expect a rate cut soon since it

has done what it's supposed to do if

inflation dies down to the regular

average we don't need fed rates up so

high and can ease that burden knowing

that the FED rates will likely be cut

very soon and then continue Cuts over

the next year or two one stock category

is going to go through the roof because

of this but first I want to thank and

introduce sponsor of this video land of

land which is America's Premier Land

wholesaler looking to diversify your

portfolio consider vacant land including

land assets can help spread risk across

different asset classes and hedge

against Market volatility because as you

know land is a limited resource I like

this as an option for investing but I

also like this as an option for someone

to be able to buy land and then be able

to build the house of their dreams for

later on land of land streamlines the

buying process keeping costs low and

transactions quick you can even handle

everything remotely often in just a day

go to this link to register for their

next auction at land ofland auction.

auction.com the link is found down in my

description and be sure to enter code

Prof g p rofg to receive a $300

reduction on your total invoice on land

you win and purchase through its auction

as Mark Twain famously said buy land

they're not making more so the one stock

category that's going to increase the

most in my opinion is going to be one

that has to do with something that's

very variable and has to do with what

happens when the Fed rate goes up or

comes down so it's very contingent on

that actual rate and that would be

anything having to do with real estate

investing within the world of real

estate is very solid and there's a lot

of great options but one of my favorites

is called a Reit REITs have crazy high

dividends so you can live off passive

income with these and they let you

invest in real estate without needing

hundreds of thousands of dollars I

recently did a video of five of the best

ones over the next year so I'll link to

that and quue it up for you to play

right after this video if you want to

live entirely off of passive income and

replace place your full-time job with

just passive income you're going to need

to find assets that produce a nice

sustainable long-term but also large

dividend and many of these reats produce

such high cash flow so they can give 7

10 sometimes 15% dividends if you have

$1 million and you want to live off

passive income but the stock only gives

a 3% dividend that's only $30,000 per

year if the stock gives a 13% dividend

like the re Blackstone mortgage trust

Inc BX xmt you'd be able to earn over

$130,000 per year completely passively

that would replace a full-time income

and you get to just sit back and collect

a check we have made no decisions about

future meetings and that includes a

September meeting the broad sense of the

committee is that the economy is moving

closer to the point at which it will be

appropriate to reduce our policy rate uh

in that we will be data dependent but

not data point dependent so it will not

be a question of responding specifically

to one or two data releases the question

will be whether the totality of the data

the evolving Outlook and the balance of

risks are consistent with Rising

confidence on inflation and maintaining

a solid labor market if that test is met

a reduction in our policy rate could be

on the table as soon as the next meeting

in

September so you asked why not today uh

and I would just say again that the

broad sense of the committee is that

we're getting closer to the point at

which it'll be appropriate to reduce our

policy rate but that we're not quite at

that point yet we when the FED does

finally cut rates expect REITs and other

real estate style assets to just go

through the roof so right now buying

them on sale is the ultimate cheat code

to watch my video on the top five reats

over the next year watch it right here

or watch this one to keep you going

strong in your investing Journey