They Are About to RESET Your Money — Pay Attention

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Tom Bilyeu (1:09)

The money system is being reset. This is getting so crazy. People are really blind to some of the ways that this is happening. And right now, we're going to go through the small handful of things that are breaking right now that show you the direction of travel for the economy and exactly what you need to be doing with your money.

Felix Prehn (1:25)

You literally have 11 days left. That's it. 11 days until a deadline that no one's really talking about. And it's going to hit the money in your bank account and in your portfolio, whether you're paying attention to it or not. The president of the United States gave the people who print your money, the Fed, an ultimatum. And the actual words, and I'll put it on the screen for you, is something like, lower the rate while stop trading with countries with which we have a deficit.

Tom Bilyeu (1:51)

Okay, everybody, you've got to understand how absurd this is. You are supposed to have a separation between what's going on in the Fed so that they're an independent body. They are not controlled by the people who want to spend the money. So you've got the people printing the money and the people spending the money thinking on their own, going in separate directions that create a dynamic tension that allow you to make sure that there's balance. When the people spending the money who want to leverage money to get elected, when they're able to tell the Fed what to do, now you have an absolute death spiral and the world is going to react. So all eyes, as we go through this, you're going to hear me talk about the bond market a lot. All eyes need to be on the bond market because if you break the bond market, that's basically people's trust that they're going to get paid back from the government. And when Trump is talking about doing that, he is cueing the people who actually understand how the economy works that you cannot trust us.

Felix Prehn (2:47)

You cannot lower interest rates or start this incredible trade when we haven't seen it. And he called high interest rates a very fair disadvantage and told the Fed to be patriots. And this ultimatum comes to you on September 16th. That's the day the Fed walks into a room to decide interest rates, which the market is currently expecting to go up. He wants them to go down. But something looks strange.

Tom Bilyeu (3:16)

Here's the thing. You also have to understand. So as we look at the bond market, when people talk about we're expecting rates to go up versus them to go down, it's better said that the rate needs to go up because people understand what's being done to the money. The fact that you've got the president, who if people are like me, they believe that the reason that Kevin Warsh in particular was picked was because he gave indications that he was willing to play ball. I do not believe that Trump and Besson would have picked Kevin Warsh if they didn't think, okay, this is going to be the partner that we need to get this stuff done, that we're going to have to work somewhat in concert with each other to grow our way out of this debt. Okay, that's a big part of the drum that Trump is banging is we've got to grow the economy and to grow the economy, we've got to lower rates. Now, the reality is that when money is cheaper and people believe in the future, they feel very optimistic, they're going to borrow that money and they're going to then start investing in their companies. And that does become stimulatory to the economy. But I want to be very clear, lowering rates is not stimulatory to the economy on its own. In fact, we watch Eurodollar University around here quite a bit.