For today’s edition of Inside Wall Street, I decided to do something a bit different.
Instead of my usual written commentary, I headed out to Manhattan’s financial district to film a quick video for you.
That’s where my career in finance began more than three decades ago. So any time I’m back there, it makes me a little nostalgic.
But it also reminds me of an important lesson from my days working there, which I carry with me to this day…
It helps me navigate the complex world we live and invest in.
And it helps me focus on the opportunities in front of us… while others are caught up in the noise caused by the events happening around us.
I’ll tell you all about it in today’s video. Just click below to watch it. (You can also scroll down to read the transcript.)
I hope you enjoy the video. Let me know what you think at [email protected].
Happy investing, and I’ll be in touch again soon.
Editor, Inside Wall Street with Nomi Prins
I’m here in New York City for a few days on my way to Washington, D.C.
And I got a little nostalgic.
I headed down to the place where I began my career on Wall Street in Downtown Manhattan.
This is One Chase Manhattan Plaza. It’s a stone’s throw away from the New York Stock Exchange…
And from the New York Federal Reserve Bank, which is the most powerful bank in the Federal Reserve system.
Why? Because it enacts all the policies that the Federal Reserve Bank in Washington, D.C. sets.
But here’s a story…
Right after I started at Chase, we had the 1987 market crash. To me, it was trial by fire.
There was tension at Chase, and all around Wall Street, in general. And there was a lot of drinking…
But my boss told me something very important back then: Markets don’t care about how you feel.
They’re going to be choppy. But they’re also going to be resilient. The key is to maintain your strategy and remain calm.
The Fed Has Investors’ Backs
The markets have been choppy for many reasons, as I’ve been discussing with you, and as I’m sure you know.
One of the main reasons, outside of the situation in Ukraine, is uncertainty about what the Fed will decide to do with interest rates…
And what it’s going to do with its massive $8.9 trillion book of assets.
With the two-day Federal Open Market Committee (FOMC) meeting results due out tomorrow, I wanted to focus on that volatility. Because it comes from rate-hike fears.
I want to tell you this: Here on Wall Street, people are way calmer than the headlines might tell you.
Veteran traders know that markets bounce back. They trust that the Fed has their backs.
You know why? Because it always has.
In his scheduled semi annual testimony to Congress on monetary policy earlier this month, he said this:
I’m inclined to propose and support a 25 basis point rate hike.
I told you that the Fed must navigate inflation. But it also doesn’t want to upset the markets.
That is the very crux of permanent distortion, and why markets are outperforming the real economy by miles.
Three Steps to Protect Your Portfolio
Today, I want to discuss how those lessons from my time on Wall Street helped me to navigate the Fed and the markets. And they can help you.
First, again, I get that things are choppy. Markets have been on edge about these rate hikes.
The Fed and other central banks will have to walk this line between raising rates by enough to be perceived to be fighting inflation…
But not so much that they completely freak the markets out more.
What that means is that they will continue to care more about the markets than the economy.
Now, the relationship between Wall Street, the Fed, and the markets is super cozy.
It’s steeped in history from around where I’m standing right now from the inception of the Federal Reserve.
And remember, Fed Chair Jerome Powell cares about his stock portfolio, too.
Here are the three things you should consider doing right now…
If you haven’t been investing in gold, you should do so. It has shown safe-haven properties during all of these choppy times.
No matter what the Fed does, the U.S. dollar will also preserve its strength relative to other currencies, like the euro, for now. Investing in U.S. Dollar exchange-traded funds (ETFs) makes sense, as I’ve told you.
Remember, the markets do prevail. They’ve got support. Stay calm and carry on.
And we will guide you through our five sectors – New Energy, Infrastructure, Transformative Technology, Meta-Reality, and New Money…
As well as the optimal investment timing in those areas alongside these choppy market conditions.
But know this: I see this period of Fed policy uncertainty as a strategic buying opportunity in the midst of all of this other global turbulence.
I’ll explain exactly what the Fed’s decision could mean for your money in future e-letters.
I hope you enjoyed this video. And as always, please send me your thoughts, questions, and comments at [email protected].
Happy investing, and I’ll be in touch soon.