Over the past 20 years since I left Wall Street, I’ve spent a lot of time on Capitol Hill.
I’ve spoken to hundreds of congresspeople, senators, members of the SEC, FDIC, Treasury Department, and Federal Reserve… On both sides of the political aisle – Democrat and Republican.
I’ve provided advice to presidential and vice-presidential candidates and their staff.
Nomi with Vermont Senator Bernie Sanders
Outside the office of U.S. Congressman Andrew Garbarino of New York
I’ve testified before the Senate Budget Committee.
And I’ve been an advisor for a powerful senator regarding auditing the Fed initiatives. Former Fed chair Ben Bernanke even addressed our group.
I don’t say all this to brag.
I say it because, in all the time I’ve spent on the Hill, I’ve learned something important. That is, what happens there can have a huge impact on your nest egg.
This probably won’t surprise you…
But Washington doesn’t exactly have your best interests in mind when it passes new legislation.
A lot of the legislation on the Hill is a combination of corporate and lobbyists’ wish lists. Suggestions or demands from other groups – from unions to economic institutions – are sprinkled in, too.
But if we look closely at D.C. documents, we can see where the government spends our money. And today, I’ll share a way to potentially profit from Washington’s decisions.
How the Federal Government Spends Your Money
The White House recently made the 2023 budget document public. It’s 158 pages long.
But one section in particular really caught my eye. It was titled:
Leveraging Federal Contracting as a Catalyst to Drive Clean Energy Solutions, Support American Jobs, and Advance Equity.
To sum up, it covers federal contracts for all sorts of initiatives.
This is a huge part of the U.S. budget.
In fiscal year 2021, U.S. federal agencies spent about $637 billion to fund millions of contracts for a host of goods and services. That’s almost 40% of the total budget.
We don’t have the full figure yet for 2022, but I anticipate it will be similarly massive.
Those contracts funded initiatives to combat climate change… boost American manufacturing… and also provide opportunities for small, disadvantaged businesses. Just to name a few.
They also covered close to $400 billion worth of spending for national defense.
For example, the White House budget document proposed $773 billion for the Department of Defense. It prioritizes China as a major 21st-century threat.
That means certain materials and technologies might be added to the Defense contractor list, in order to keep up with China.
How to Profit from Washington’s Winners and Losers
Now, let’s admit it. Poring through hundreds – sometimes thousands – of pages of Washington paperwork is not the most exciting.
But I make sure to take the time to read them. That’s because they can show us where federal money is going next. And where public money goes, Wall Street money follows.
So how can you take advantage of the “secrets” hidden in the 2023 budget document?
One way to do that is through the iShares U.S. Aerospace & Defense ETF (ITA). This exchange-traded fund (ETF) has 35 holdings in the defense and aerospace sector. That includes big names – and government favorites – like Raytheon and Lockheed Martin.
It can give you exposure to companies that potentially stand to gain from Washington’s defense spending.
Editor, Inside Wall Street with Nomi Prins
P.S. Our government has already picked the biggest winners and losers of 2023. And if you end up getting stuck with the losers, 2023 could be even worse than 2022. Fortune even warned its readers to “buckle up for more carnage.”
That’s why you’ll want to tune in for a strategy session I’m holding this Thursday, January 12 at 8 p.m. ET. I’m calling it 2023 Government Winners & Losers (RSVP with one click right here). And I’ll reveal the winners and losers of a massive $46 trillion shift coming out of Washington.
I’ll also show you a little-known strategy that will give you a chance to profit from both winners and losers at the same time. Click here to secure your spot instantly.