We’ve become prisoners of short-rate forecasts. Yeah, the ones controlled by the Federal Reserve. But those fearless investors who have broken out of this self-imposed mental jail are enjoying bountiful returns. Sure, it appears to be nothing but alchemy to the jailers and their powerful protagonists in the media. But does it matter? They don’t asterisk the returns as “done by ignoring the Fed,” when you journal the stock profits to your bank account despite where we are in the interest rate cycle. Still these returns either seem beyond the ken of most investors or they are hidden beneath the foolish rhetoric of so many who pontificate about stocks and the impact of short rates on them. No one sets out to obfuscate. But the outcome is one of intellectual impoverishment. That’s because there is a relentless Fed official-strategist-journalist complex that could blunt the realm of any stock picker and dismiss their tiny sliver of the universe unless they are traders nimble enough to choose “names” that work between cycles. I find the complex and its trader amen corner needless even as their dogma has captured the microphone. I don’t want to fall back to the cliched, “I have seen this movie before,” simply because I abhor cliches. But there have been many times when leading intellectual billionaires and their minions have lectured us about the inability to profit from this pre-rate-cut moment. Their primary shibboleth: “Don’t you dare try to make money without Fed rate cuts.” Plus, the disparate phalanx Fed officials seem to enjoy roiling the markets with their off-handed chatter — July as the first rate cut since the tightening paused and three times total for the year? or October and two times? or 2024 no times? — fully recognizing that most journalists will hang on to their every reported word. Sometimes I think, facetiously, that everyone in the complex is paid by the spoken word. The traders drown out the concept of investing in stocks right now and…
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