Hey There Income Hunter,

 

My Power Income Trader system is designed to:

 

• • • Identify the stage of inflation you’re trading in
    • Dictate the sectors to be long and short so you always maximize returns

 

I created the four inflation stages identified by Power Income Trader because one of the Federal Reserve’s mandates is stable prices, meaning a 2% inflation target.

 

Another key input is growth, because the Fed’s other mandate is full employment. 

 

Now, with real inflation near 15% (!), the Fed is now forced to get it down by destroying economic growth, which will decrease spending and slow inflation down. 

 

This policy puts today’s market environment solidly in a Stage 4 – a slower growth and slower inflation environment – which is the bear of all bear markets.

 

However, bear markets can be even more profitable than bull markets

 

And Power Income Trader will give you the blueprint you need to crush it in the months and years ahead. (The track record is there – my average gain in 2021 was 68%.)

 

Today, I’ll show you why we are heading into a DEEP Stage 4 decline and how long/short paired trades can decrease the vol in your portfolio and increase your returns. 

 

Let’s poke the bear.

 

Inflation Is Raising Costs But Not Income

 

Inflation is always a function of an increase in money supply. Since 2008, the Fed has printed $14 trillion dollars of new money. More than $8 trillion was the Fed’s quantitative easing policy (QE) and the other $6 trillion was government spending.

 

(Not fun fact: that demanded $14 trillion in debt to be issued to pay for it.)

 

This new money supply has ignited the highest price increases (inflation) we have seen in 40 years.

 

However, as you can see in the chart below, the massive amounts of new money only gave a sugar rush to the economy – which is now all but gone. 

 

 

What we are left with is declining real wages as inflation continues to act as a tax on wages and wealth.

 

Meanwhile, prices remain stubbornly high and will continue to deplete consumers’ savings and wealth until it is brought back down and under control. 

 

Businesses are Getting Squeezed

 

Businesses are getting hit even harder than workers because supply chain issues have limited their ability to get the materials they need.

 

And when they finally arrive?

 

They are much higher in price.

 

This will cause many businesses to fire workers and suffer a narrowing of profit margins.

 

The chart below highlights the dramatic decline in earnings we will begin to see when the Q1 earnings data comes out. 

 

 

Yes, 2022 has the potential to be one of the worst stock market declines we have ever seen.

 

And the market will stay down until the Fed can reverse course and go back to printing money. 

 

However, the Fed has been politicized by an administration that realizes inflation has spooked Americans … so the only thing that will give the cover to flip back to easing is a crash.

 

There are not many traders today that understand inflation.

 

And on the heels of a couple of explosive bull markets they are unsure what strategy to deploy in this environment. 

 

That’s why I’m here.

 

Turning a Bear into a Bull Market for Your Profits

 

The Power Income Trader system will make it easy for you to increase your profits in this environment by playing the market from both the long and the short side and making money both ways.

 

By knowing the sectors that outperform in Stage 4, and which ones underperform I give you paired long/short trades that offer a win-win scenario.

 

In a Stage 4 bear market, when growth and inflation are slowing. back-tested results show that one of the worst performing sectors is the SPDR Financial Sector ETF (Ticker: XLF) and one of the best performing sectors in the SPDR Utility Sector ETF (XLU) … 

 

So, last week Andrew Giovinazzi and I went live and shared our long/short paired strategy with you.

 

(We put the trade on in our books as well, because we always put our own money on the trades we present.)

 

As you can see in the chart below, the bear strategy on XLF and bull strategy on XLU are working nicely.

 

XLF is up almost 50%, while XLU is also slightly ahead.

 

 

The idea is we are bearish – but bear market rallies can be vicious. So to give you staying power, we pair a bad performer with ones that perform well in bear markets. 

 

For instance, XLU will rally when the overall market rallies. But in Stage 4 it performs very well when the market goes down because utilities are protected by the government when the economy is weak. 

 

Bring It Home

 

We have many more ideas for trades like this and the more you can put on, the greater your opportunity is for success. 

 

The best part it is, it’s so easy! Easy to receive the trades from AG me – AND easy to learn to put them on yourself. (The choice is yours.)

 

These are proven results from past slowing growth and inflation environments.

 

Plus, I specialized in Fed Policy for 25+ years trading on Wall Street … and now I want to help you protect yourself during an inflationary period that may last for a decade. 

 

Join Power Income Trader – quarterly subscriptions are currently 25% off – and get access to our first bi-weekly small-group FED FOCUS event on Thursday. (Those will run through the Fed’s May 4 meeting.)

 

Remember there are always bull and bear trades that can make you money,

and now it is a must to play this market from both sides.

 

See you Thursday …

. 

Live and Trade With passion My Friend,

Griff