BY MARK SEBASTIAN
June 18th, 2025
Dear Money-Maker, Mark here.
I’m still shaking my head at what happened during Powell’s speech today.
Look, I was live with Hans and our Special Situations traders, watching this whole thing unfold in real time. And something was seriously off.
The market stayed flat. Dead flat. While Powell basically told everyone the economy’s heading into stagflation territory.
Here’s what nobody’s talking about – the Fed just lowered GDP forecasts from 2.5% down to 1.4%. At the same time? They bumped inflation expectations up to 3.1%.
Lower growth, higher inflation. That’s… that’s not good, folks.
What Really Caught My Attention
Check out which stocks hit new highs today. IBM. Cardinal Health. Bank of NY Mellon.
These aren’t growth darlings. These are defensive, dividend-heavy names that do well when the economy’s slowing down.
What Powell Actually Said (vs What You Heard)
Everyone heard “we’re well positioned to wait.”
What Powell actually said was they’re worried about tariffs creating inflation that sticks around. He used phrases like “elevated uncertainty” and talked about the economy being in “solid shape” – which is Fed-speak for “it’s okay now but we’re concerned.”
And get this – they’re forecasting unemployment to go up. From 4.2% to 4.5%. When’s the last time unemployment rose during a strong economy?
Here’s What I’m Watching
And bonds? TLT couldn’t get excited about anything today. Usually when the Fed sounds dovish, bonds rally. Today? Nothing.
The market’s acting like Powell gave the all-clear. But if you actually listened to what he said about GDP growth slowing and inflation heating up… that’s not an all-clear.
I’ve Seen This Movie Before
Look, I’ve been through this. When the Fed tells you growth is getting cut in half – from 2.5% to 1.4% – that’s not confidence. That’s them preparing you for reality.
Smart money’s already positioning. Look at where the flows went today – defensive names, dividend plays, stuff that works when growth disappoints.
What I’m Doing
I’m not chasing this rally. The setup doesn’t make sense.
When the Fed hands you a roadmap showing slower growth and higher inflation, and the market shrugs it off? That disconnect doesn’t last long.
The writing’s on the wall. Question is whether you’re reading it.
-Mark
P.S. Speaking of reading the signs… Hannah and Andrew went live last night to reveal how Wall Street’s biggest players leave fingerprints all over the market before major moves happen. If you missed it, click here to watch it now.
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