Here’s how to find income when the Fed caves.
At some point this year, America will have a new chairman at the Federal Reserve. You might want to start preparing your portfolio now for what’s to come.
Because what’s to come are sharply lower interest rates—and that has impacts on your ability to generate yield from your cash.
Prez. Trump has stated numerous times now that he fully expects the next Fed chair to kowtow to Trump’s oft-mentioned desire for 1% interest rates, and that “Anybody that disagrees with me will never be the Fed Chairman!” (By the way, that’s a direct quote—not me goofing around with Trump-speak.)
I could spend the rest of the day writing a long and detailed treatise on why 1% interest rates are mucho bad-newso for the US economy and, particularly, the US dollar. But I shall refrain.
Instead, I will say, “Start prepping now for lower interest rates!”
“Ok, El Jefe, go ahead and tell me what I should be doing…”
Forgive my blunt sales pitch here, but you honestly should be signing up for my upcoming Passive Income Workshop. Its aim is squarely on helping folks navigate the world of income opportunities that are easily investable inside a typical brokerage account or an IRA.
The last time I held this masterclass back in June of 2025, we were in a world marked by Trump’s tariffs and the administration’s stated desire for a weaker dollar. Those worries remain in place, and they continue to have their harmful impacts.
But this time around, we have the added sweetener of an incoming Federal Reserve chairman who will bend to Trump’s will. Odds on favorite at the moment is Kevin Hassett, who has confirmed that he agrees with Trump’s interest rate desires.
Honestly, though, whoever Trump picks is little more than rearranging deck chairs on the Titanic at this point. Trump’s quote from above tells us everything we need to know about upcoming interest-rate policy.
And upcoming interest-rate policy tells us a lot about the direction of the dollar.
The US will be shrinking interest rates to a level that will fall below rates on the euro, Aussie dollar, Kiwi dollar, and British pound. Moreover, Japan is in the process of raising rates, which will see the yen at some point this year yielding more than the dollar for the first time since 1992—more than three decades ago.
As I’ve noted in recent dispatches, currencies move in pairs—one rising; one falling—based on interest rate differentials.
So the incoming, non-independent Fed chairman lowering rates means the value of the dollar will be sinking against other world currencies. (It also means the world will perceive the death of the Federal Reserve’s much-vaunted independence, which will also help destroy demand for the dollar).
In this new interest rate environment, US savers will find no solace in bank CDs, savings accounts, or money market funds, where rates will collapse to below 1% yet again.
In that world, you’re gonna have to play the role of hound dog and go sniffing around for sources of income in the stock market, among preferred stocks, in “baby bonds,” and across the universe of master limited partnerships, real estate investment trusts, and foreign dividend-paying stocks.
I won’t dive into each of those here; I’ll save that for the workshop…
But I will tell you that there aren’t a whole lot of other options to consider, if you want to actually earn money on your investable assets.
Before I started writing this dispatch, I went back and looked at the portfolio I shared with attendees at the last workshop, in June.
They’re eating well.
Of the 17 investments I recommended, 16 are up between 1.1% and 53.9%, when including dividends and bond payments. Just one is down—9.1%
Overall, the portfolio is up 13.9% in the six months since the masterclass aired, and it’s yielding about 7.8% on an annualized basis—well above the meager 1.15% the S&P 500 is offering these days, or the 1.66% on the Dow 30.
Now, I am not promising these kinds of returns will persist.
Who knows what’s coming next in the US and global economies?
All we can do is prep for what seems pretty certain.
And what seems almost assured at this point is that the Federal Reserve is about to launch into a rate-cutting orgy to appease a president who can’t quite understand that he should keep his mouth shut vis-à-vis the Fed and its actions.
As that orgy unfolds:
- Interest rates on dollar-based savings will crumble, and
- The dollar itself will fall in value, relative to other currencies.
The simple math of that two-pronged reality means you gotta start thinking about how to earn income now. You want to get out ahead of this train.
Once the Fed starts acting, you’re going to see income-focused investments kick into a new gear… meaning you’ll not only be collecting plump income payments, you’ll benefit from capital gains as well.
So, once again forgive me for being a blunt pusher of an El Jefe product, but the upcoming Passive Income Workshop is your path to surviving and benefiting from the New Trump Fed—coming soon!