“What is the greatest danger to your investments? Inflation.”
– Paul Cabot (The Maxims of Wall Street, Page 149)
I have THREE major events to discuss today.
The first happened last week: The SpaceX IPO was a big winner for subscribers to The Skousen Report, who were able to buy into the largest IPO ever. I recommended two ways to buy SpaceX before it went public. Both have advanced by double digits.
I expect SpaceX to be a big winner in the long run, but it will be volatile in the short run.
The Fed to Meet This Week
The second big event will occur this Tuesday and Wednesday: the first meeting of the Federal Open Market Committee under new Fed Chair Kevin Warsh.
The big question is… Will the new Fed chairman make a difference, or will the Fed be the same old engine of inflation and instability that it has been for the past 100-plus years?
As your Macroeconomic Strategist, I have the answer!
The Fed has had a checkered history since its inception in 1913. It has gradually become a key contributor to inflation, adopting easy money policies during wars, recessions, and monetary crises.
As a result, since World War II, we have entered an era of permanent inflation, as this shocking chart demonstrates.
(I discuss the reasons inflation is permanent these days in this column.)
The Fed has failed to consistently meet its goals of price stability and full employment. When Ben Bernanke was made chairman in 2006, the central bank adopted a 2% inflation rule, but since the pandemic crisis of 2020, it has struggled to meet that target. The affordability crisis is real.
Why I’m Optimistic
Will Kevin Warsh make a difference?
As a supply-sider, he will likely make a valiant attempt to bring price inflation down. He is an inflation hawk who actually resigned in 2011 from the Bernanke Fed in protest of the inflationary quantitative easing (QE) during this period.
But will he bring Consumer Price Index (CPI) inflation to zero? Not by a long shot. The inflation rate will continue to be positive, but it is likely to drop to the 2% target with the end of the war in Iran and the imposition of a tighter monetary policy and reduction in QE. It would also help if Congress becomes more fiscally responsible in cutting the deficit significantly.
I don’t see real price stability, but Fed policy should be better than what we had under Jay Powell.
The Warsh Fed will do what it can to reduce the inflation rate and thus fulfill President Trump’s demand for lower interest rates. But you can’t lower rates when inflation is rising!
What does the Warsh Fed mean for Wall Street? Lower inflation will be positive for the stock and bond markets, but negative for gold and other inflation hedges in the short term.
I don’t think you can “End the Fed,” as former Congressman Ron Paul and other libertarians have called for. Central banking is just too powerful a tool for government. Instead, we need to do whatever we can to restrain the Fed and make it work better – that is, work toward “sound money” based on the price of gold as a Fed target (the closest we will come to a gold standard) and continue to focus on CPI price stability and full employment, the two long-term goals of the Fed.
Beloved TV Actor Coming to FreedomFest!
My third announcement is exciting…
Hollywood is coming to FreedomFest.
We just confirmed our keynote celebrity speaker: Kelsey Grammer, better known as “Frasier”!
As an award-winning actor in television (Cheers, Frasier, and Wings), in film (Avengers: Doomsday, X-Men, and Toy Story 2), and on Broadway (Macbeth, My Fair Lady, and Beauty and the Beast), he has won six Emmy Awards, three Golden Globes, and a Screen Actors Guild Award.
He will tell his story and his vision of America in a main-stage interview, a luncheon, and a VIP reception (all on 7/11 in Vegas at the Caesars Forum convention center) and then will join us in our celebration at the Saturday night banquet.
He is the perfect celebrity to celebrate the 250th birthday of the United States of America. This year, he started The American Revelation Foundation to help Americans rediscover the stories, principles, people, and ideas that have shaped the nation. Through storytelling, media, education, and cultural engagement, the organization aims to strengthen understanding, unity, civic participation, and appreciation for America’s shared story. You are invited to join the celebration at www.AmericanRevelation.org.
But there’s more – a lot more – to celebrate July 8-11 in Las Vegas.
The M&M Boys Go to Bat for You at FreedomFest
Marc Lichtenfeld, the brilliant Chief Income Strategist of The Oxford Club, will be joining me. The Oxford Club is one of our official sponsors and will have an exhibit booth there to answer all your questions.
Growing up, I was a big fan of the “M&M Boys,” Mickey Mantle and Roger Maris, in their goal to catch Babe Ruth’s home run record in 1961.
Marc and I plan to do the same at this year’s “World’s Fair of Liberty” at FreedomFest. We plan to show attendees how to hit some grand-slam “10-baggers” in super-growth and income stocks this year. We are doing a special breakfast together on Saturday, July 11, in Vegas. Come join us before it sells out.
Be sure to stop by our Oxford Club booth… and ring the Liberty Bell in the exhibit hall!
Let the Debates Begin!
“By the collision of different sentiments, sparks of truth strike out, and political light is obtained.” – Benjamin Franklin
One thing I love about FreedomFest is our debates. They are civil, constructive, and enlightening.
Who could forget the debates between Paul Krugman and Steve Moore… between Donald Trump and Roberto Salinas… or between Kevin O’Leary (“Mr. Wonderful” on Shark Tank) and John Mackey? Of course, we’ll also hold our popular mock trials, where we have previously put on trial the Republican Party, capitalism, America’s foreign policy, and public unions, among other things.
Our debates are unique. They are civil debates. We don’t allow debaters to talk over each other like they do on CNN or Fox News.
This year, we have a great lineup…
One debate will be titled “Is Trump a Net Gain or a Net Loss for Liberty?”, with Austin Petersen and TV personality Wayne Allyn Root defending the president and Reason magazine senior editor Jacob Sullum and Keith Knight criticizing him.
I’ll be moderating a big “capitalism versus socialism” debate between John Mackey, the former CEO of Whole Foods Market and author of Conscious Capitalism, and Marxist professor Andrew Hartman. The debate will center around the statement “Karl Marx’s critique of capitalism is fundamentally flawed; free-enterprise capitalism is the greatest system ever invented to fulfill the needs of most members of society.”
I can’t wait! See the full list of speakers and events at http://www.freedomfest.com.
Save $100 Using This Code
Subscribers get $100 off the registration fee by using the code “OXFORD100” (new registrations only). All the details can be found on the FreedomFest website or by calling Hayley at 1.855.850.3733, ext. 201.
I hope to see some of you there. Join me in ringing the Liberty Bell in our exhibit hall!
