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American Baseball and Banking…

by | Mar 21, 2023

LoanDepot Park is two hours and 15 minutes from my house. 

It’s home to this evening’s championship game between the United States and Japan. And if I don’t get on the road…

Now… 

I’ll be missing this once-in-a-lifetime event. 

But before I surge across Alligator Alley, I wanted to give you a preview of what to expect with the Federal Reserve tomorrow. 

The Fed will likely raise interest rates by 25 basis points, despite the ongoing concerns about the stability of the banking system. 

Let’s discuss the key terms you need to listen for during the Fed’s conference at 2:30pm ET…

And what event you must attend (for free) tomorrow morning.

Mr. Powell, What Will You Do?


The markets chopped around again on Tuesday as investors positioned themselves ahead of the Fed’s decision. 

According to CME FedWatch, there’s an 86% probability that the Fed will raise interest rates by 25 basis points. There’s a 14% chance that we’ll see no rate hike.

impact of a Fed interest rate hike

I expect a hike for one reason. The Fed has to save its credibility in a high inflation environment. 

Given the European Central Bank just raised rates by 50 basis points – in the face of a continent-wide banking rout – the Fed should follow through with 25 points. 

Otherwise, the Fed might be hinting that the economy, the banking system, or both faces greater instability than expected. 

So what comes if the Fed does hike rates by 25 basis points?

You might be surprised, but a possible relief rally could continue. 

The general concept here is that the Fed is moving closer to the completion of its rate hiking cycle – and a pause could follow. 

Tomorrow’s event is less about the actual rate hike – and more about what comes next? What comes next will likely be determined by Federal Reserve Chairman Jerome Powell’s post-conference discussion at 2:30pm ET. 

Before that meeting, you need to join the live “Roundtable with Don Yocham” at 10am ET tomorrow at this Zoom link.

His guests Celeste Lindmann and Roger Scott will give you the top trade ideas as the Fed makes its critical decision. They’ll be answering key questions:

  • How will the Fed handicap the banking crisis? 
  • Can it be contained or is financial contagion inevitable? 
  • What will the Fed sacrifice on the altar of saving banks?

Celeste will discuss the movements of the S&P based on past Fed announcements, both immediately following the announcement and over subsequent days. 

Plus, she’ll reveal summer trading strategies. Remember, she nailed that General Electric (GE) call last time we were on the show together. 

Meanwhile, Roger will show us a volatility-prone sector, what sectors are overbought and oversold, and what seasonality is telling us right now about the market. 

Join Don and the rest of the team… right here at 10am ET.

Fed Interest Rate Hike: Let’s Discuss Winners and Losers


I expect that most of the questions tomorrow will be less about interest rates and more about the state of the economy and banking system. 

This morning, in a speech to the American Banking Association, Treasury Secretary (and former Fed Chair) Janet Yellen said that the U.S. government could backstop additional banks if there are liquidity problems moving forward. 

Yellen said that actions taken by the government in recent weeks weren’t efforts to help specific banks…

They were designed as a commercial solution for the entire banking system.

“The steps we took were not focused on aiding specific banks or classes of banks. Our intervention was necessary to protect the broader U.S. banking system,” Yellen said. “And similar actions could be warranted if smaller institutions suffer deposit runs that pose the risk of contagion.”

This is the bigger story than the rate hike – which won’t reverberate through the economy until Q3. 

Instead, the short-term focus on the banking system – and the confidence exhibited by Powell tomorrow – will likely drive the reaction of the market. 

Banking stocks and energy stocks are coming out of oversold conditions right now. 

We’re seeing really great energy names like Apache (APA) rally on the back of stability in the banking sector. Energy stocks are looking better – and now is the opportunity to take advantage of that dramatic fear in the market. 

I assume that a lot of people are net-short right now. But it’s a very good time to start thinking long-term. 

Over at Tactical Wealth Investor one of my favorite stocks just hit a double-down territory at a mouth-watering dividend. You can still get the Charter price before we take it away in April. 

Now’s the time to strike, while everyone else is afraid to pull the trigger. That’s how you look for real wealth in these markets.

To your wealth,

Garrett signature
Garrett Baldwin



Market Momentum is Yellow

Momentum is yellow as the markets prepare for tomorrow’s event from the Fed. I’m viewing this as a very good opportunity to tap into strong dividend stocks because this could be the Fed’s final rate hike. If that’s the case, dividend stocks will fall into favor of investors as interest rates pull back on the backside of the year.

WRITTEN BY<br>Garrett Baldwin

WRITTEN BY
Garrett Baldwin

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