I'm Buying this Stock like CRAZY after new CPI Inflation Data
Summary
TLDRThe 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
📈 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.
🏢 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.
Mindmap
Keywords
💡CPI data
💡Inflation
💡Federal Reserve
💡Interest rates
💡Economic indicators
💡Real Estate Investing
💡REITs
💡Passive income
💡Bankruptcy
💡Portfolio diversification
💡Land of Land
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
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