You’ve come to the right place if your eyes roll back whenever you hear pundits wonder aloud which month the Fed is finally going to raise interest rates. In these precincts, the answer to that question for years has been an emphatic “NEVER!!” Yes, we know, “never” is a long time; eventually we’re bound to be wrong. But until that day arrives, we can boast that no economist in America has predicted Fed behavior more accurately than we have. The reason we’ve gotten it right and the eggheads continue to get it wrong is that most of them view the Fed not merely respectfully, but reverently, taking every syllable of drivel that passes the Fed chairman’s lips as holy writ. We, on the other hand, think the central bankers are a bunch of pompous quacks who couldn’t run a lemonade stand, much less a global banking system. (Side note: Recall that Alan Greenspan, with a PhD in economics from NYU, ignorantly referred to inflated home prices as “wealth” many times, and spoke of a boom in capital investment at a time when household savings growth was in fact negative.) As for those who even believe the central banks can control economies, let alone fine-tune them, they are either missing a few screws or besotted with New York Times and Wall Street Journal op-ed pieces that treat monetization as something other than the brazen hoax that it is.
As an antidote for all of the economic claptrap we are forced to endure from the mainstream media, we offer today the out-of-the-box thinking of our friend Doug Behnfield, whose investment ideas have been featured here many times in the past. Doug is, hands-down, the savviest financial adviser we know. In this timely essay, he explains why the Fed is unlikely to raise rates any time soon, regardless of how many “experts” believe otherwise. If he is right, long-term rates are headed much lower, and T-Bond prices correspondingly higher. We’ve remained bullish on such investments, and on the long end of the yield curve, as T-Bonds have corrected sharply since April. Now, we think it’s time to jump aboard for the next stage of the long-term bull market in Treasury. Doug Behnfield’s report corroborates this strategy in ways that are most compelling. If you want immediate access to it in pdf form, click here. You will also be able to sign up for a free two-week trial to Rick’s Picks that includes daily touts, intraday bulletins and access to a 24/7 chat room that draws some of the best traders from around the world. (Late-breaking note: Over the weekend, James Bullard, Bank of St. Louis president, asserted that the Fed is “in good shape” to raise rates “in September”. We confidently predict that when September has come and gone, Bullard will only have embarrassed himself with his lame attempt to talk the talk. He won’t be the first.)
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