Fed's Rate Decision: Full Breakdown & Transcript

[00:00] The Federal Reserve Bank is getting nervous, because on September 16th, they have to make a decision. What are they going to do to save our economy and to save the United States dollar? On one hand, President Trump has been pushing and demanding that the Federal Reserve Bank cut interest rates.

[00:17] On the other hand, we are seeing more and more pain in inflation, and the Federal Reserve Bank keeps saying that we might have to keep interest rates higher for longer, or maybe even raise interest rates to protect the dollar.

[00:29] and this is where everybody's holding their breath to see what's going to happen because if they do raise interest rates that's going to put more pain on the economy it's going to put more pain on the stock market it's going to put more pain in people's wallets

[00:42] during a time where it's harder to buy a house during a time where people are struggling to pay for cars during a time where credit card debt is high and during a time when the national debt is costing the government more

[00:54] than our entire military if interest rates go up although those things become more expensive. But if the Federal Reserve Bank cuts interest rates, yeah, it becomes cheaper to buy a house, it becomes cheaper to buy a car,

[01:07] the national debt becomes a little bit cheaper, but then the inflation problem could get worse. And we've already been seeing that problem because over the last 12 months, people's incomes have not kept up with inflation, which means, yes, the average person is poorer today than they were 12 months ago.

[01:23] This is not me just saying things. This is data saying that the average person in America is poorer today because the average person's paycheck buys less stuff today than it did 12 months ago, despite the raise that you might have gotten over the last 12 months.

[01:38] So let me break this all down with what the Federal Reserve Bank is looking at, what they might do, and what that means for you, and how you can find opportunities through all of this. Again, this is why on September 29th, I'm hosting a live, free, and virtual investor workshop because I asked you, I ran a poll, and the number one concern that the Minority Mindset audience had was the dollar losing value.

[02:00] And so what I'm going to do on September 29th is show you how you can profit from the dollar losing value, what assets you can consider looking at, and how you can start thinking like an investor. So if you're an investor, I'd like you to join me on September 29th.

[02:12] It's free, it's live, and it's virtual. I'm doing it twice on September 29th, once in the morning at 10.30 a.m. Eastern Time, and then again in the evening at 8 p.m. Eastern Time. So if you haven't registered yet, I have that link for you in the description below.

[02:26] And as an added bonus, when you sign up, you're also going to get added to Market Briefs, which is on users for investors, completely for free. So the Federal Reserve Bank is the central bank here in the United States. And the reason why this is so interesting now is because the Federal Reserve Bank is not a bank.

[02:43] It's not a reserve. and they're not federal, which means they're not supposed to be told what to do by the White House. But things got interesting in 2026 because the previous chairman, his name was Jerome Powell,

[02:56] he was the guy that headed the Federal Reserve Bank, his term expired in 2026. And when the chairman's term expires, the president of the White House gets to then pick

[03:09] who's going to be the next chairman. So, Jerome Powell was getting a lot of criticism from President Trump because he was refusing to cut interest rates even though President Trump was demanding lower interest rates.

[03:23] Well, President Trump then said he's going to appoint somebody who is going to be much more likely to cut interest rates because President Trump says again and again and again that we should have the lowest interest rates of any country in the world.

[03:36] So, President Trump appoints Kevin Warsh. and now a lot of people got excited that, okay, maybe he's going to cut interest rates and that's going to stimulate the stock market, it's going to stimulate the economy. That would be great for investors,

[03:48] not necessarily good for the average person because inflation is good for investors, but not good for the average person. Well, Kevin Walsh is now essentially saying we might not be able to cut interest rates in 2026.

[04:02] In fact, we might have to raise interest rates in 2026. How do we know? Just recently, there was a meeting in Jackson If you don't know the story about Jackson Hole, Wyoming, it is a place where central bankers from around the world come and meet to discuss economic and monetary policy.

[04:20] A very random place to do it, but that's the way to do it. And during that meeting in Jackson Hole, Kevin Walsh, who was the new chairman at the Federal Reserve Bank, who was appointed by President Trump, said, quote,

[04:32] Prices are too high, and we are going to fix it. He also said, quote, we must be confident that underlying inflation is moving to our objective clearly and at sufficient speed, otherwise we have work to do.

[04:46] Which means he highlighted that the things in this country that you want to buy are excessive, which is inflation. Now, how does the Federal Reserve Bank control inflation? And there's two ways that they can control inflation.

[04:59] The first thing that they can do is raise interest rates, and the second thing that they can do is something called quantitative tightening. And to understand how this works, let's take a look at what has happened over the last six years. Because for anybody who is a financial nerd, the last six years were really a masterclass in how economics works.

[05:18] The 2020 pandemic hit. The economy was shut down. Nobody is working. And the United States government doesn't have money to fund unemployment checks or stimulus checks or PPP loans or grants for bailouts.

[05:33] Because the government was already in debt. And so what did the government do? We said, okay, we're going to shut the economy down, but we're going to send out big unemployment checks, we're going to send out big stimulus checks,

[05:45] we're going to send out some big PPP loans, we're going to send out some big grants and big bailouts. This was trillions of dollars that the government then spent. But they didn't have that money.

[05:58] They were already in debt. So how did we now get this money? We went deeper into debt. Well, as we went deeper into debt, we borrowed this money from the Federal Reserve Bank. Now, the Federal Reserve Bank, I told you, is not federal, but they're also not a reserve.

[06:14] That means they're not sitting on any extra cash, which means the Federal Reserve Bank now when they lent this trillions of dollars to the United States government that money had to be created on its own It was invented It was printed Now when the Federal Reserve Bank creates this money and they lend it to the United States government that money had to be created on a thin air It was invented It was printed Now when the Federal Reserve Bank creates this money and lends it to the United States government

[06:32] more money enters the economic system, which at first makes you feel rich because when people had stimulus checks, I was living in Chicago during that time, for a little period of that time,

[06:44] and on Michigan Avenue, which is the main shopping area, they have all those big fancy stores like, I don't remember, Rolex and Gucci and Louis Vuitton, you know, those brand name stores.

[06:57] And it was crazy because there used to be a two-hour wait on a Tuesday afternoon to get into any one of these stores. There was ropes and lines and people had money. They were rich.

[07:10] And so people were spending money that it was free. And the most expensive money is free money. I'll talk more about that in just a second, but that was what was happening. during the 2020-2021 time.

[07:22] Well, all the money got created, people felt rich, well, a lot of people were not working, and it's not just people, it's businesses too. But the next thing that happened was inflation. Now, everybody assumes that inflation was the prices of things going up,

[07:35] but truly the inflation was the creation of the money, the prices of things going up, it's just a byproduct, because you cannot print wealth. You can print dollars. everybody felt wealthy

[07:48] when they got those stimulus checks but truly didn't get wealthier they just got more dollars but those dollars now have less buying power it just takes time for the economy to absorb all those dollars and so here we came into 2021

[08:00] and now inflation starts to become a problem we now see the highest inflation that we have seen in many decades and now we start to face the consequences of that money printing

[08:12] that was where in 2022 the Federal Reserve Bank had to take action because the inflation problem did not go away. Everybody said it was going to be transitory inflation. Well, it was not transitory.

[08:24] It was real permanent inflation. In fact, we're still facing the consequences of that today, but I'll get to that in just a moment. So in 2022, the Federal Reserve Bank did the first thing, which was they started raising interest rates

[08:36] because during the pandemic, not only was that money printed, but interest rates were also brought down to the lowest levels in the history of time. That's why you could get a 3% mortgage during that time, or even a 2.8% mortgage.

[08:49] Well, the Federal Reserve Bank then started to raise interest rates to make borrowing money more expensive, the idea being that if people are borrowing less money, there's going to be less spending to help calm the inflation down.

[09:01] But that wasn't enough. The second thing the Federal Reserve Bank did was QT, quantitative tightening, which is the opposite of quantitative easing. Now, remember what I just said. The Federal Reserve Bank printed trillions of dollars and then injected it into the economy.

[09:18] That injection of dollars is quantitative easing. Quantitative tightening is pulling dollars out of the economy. So, it's a two-pronged approach to help fight inflation. First, we're raising interest rates to make it more difficult to borrow money for spending slows down.

[09:33] But then the Federal Reserve Bank is also trying to now pull money out of the economy for the less dollars out there to help fight inflation. And how did the Federal Reserve Bank do that? Well, that's some fancy calculations, but the idea is they're going to be selling off some of their assets.

[09:46] They're going to be selling off some of these treasuries to help reduce how much dollars are floating out in the economy to help bring inflation down. And we did see the inflation rate come down. We went from around 9% some inflation during the peak.

[10:00] Today, we're at a little bit under 4% inflation. So the inflation rate did come down, but the prices of things did not go down. And the reason why the prices of things did not go down is because the prices of things is not the inflation rate, it's inflation.

[10:16] So if we have a positive inflation rate, then the prices of things are going up. What that means is if the inflation rate falls from 9% to 3%, it doesn't mean that the prices of things fell, that just means that the prices of things are rising less fast than they were before.

[10:32] so in 2022 we started this process to fight inflation to bring the inflation rate down not to have negative inflation but to bring the rates of inflation down and it started to work

[10:44] and in 2025 that was when the Federal Reserve Bank said you know what we have solved the inflation problem we're all good now we're going to start cutting interest rates again

[10:56] and we're going to stop quantitative tightening and we're going to start quantitative easing again Yes, in 2025, the Federal Reserve Bank opened up the money printer again, and they started cutting interest rates.

[11:09] But then, in 2025, it got even more interesting, because President Trump also passed tariffs. And that was when the Federal Reserve Bank said, you know what? We don't want to pass any more interest rate cuts, because we don't know if these tariffs are going to cause more pain in inflation,

[11:24] so we're going to calm down with these interest rate cuts. That was when President Trump got very vocal. He said, you, the Fed, which was then led by Jerome Powell, you must listen to me. You're very stupid, you're this and that, and you must start cutting interest rates.

[11:38] Well, interest rates did not get cut again, and then Jerome Powell's term expired. Jerome Powell was then replaced by Kevin Walsh, who was hand-picked by President Trump, because President Trump wants lower interest rates.

[11:52] Kevin Walsh now comes in, and then President Trump attacks Iran. Oil prices went up. Now, these higher oil prices have a direct impact on inflation because oil prices make gas more expensive.

[12:04] It makes diesel more expensive, which makes groceries more expensive. Oil also is used to make fertilizer. That more expensive fertilizer makes it more expensive for farmers to produce crops. That makes, again, your groceries even more expensive.

[12:17] So now, traveling becomes more expensive. Locations become more expensive. Your groceries become more expensive. And really, everything becomes more expensive when you have higher oil prices. And so now we have a situation where inflation is a bigger problem than it was 12 months ago.

[12:34] And now the Federal Reserve Bank has to decide what to do. And on one hand, President Trump wants lower interest rates to stimulate the economy. But on the other hand if you start stimulating the economy when inflation is a problem that can make the inflation problem worse And now all of a sudden you can have an inflation problem that can spiral out of control We seen that happen in the past If you subscribed to my channel you know

[12:55] I like to talk about history. Because while history does exactly repeat itself, it does rise. In the 1970s, we had a lot of money printing happen. Just like the pandemic era.

[13:08] But in the 1970s, the money printing happened because the dollar was taken off of the gold standard in 1971. When that happened, a lot of money printing was done. That way the government could spend more money and pay back its debts.

[13:22] Then, after the money printing, we saw an oil crisis in 1973 through something called the Yom Kippur War. Now you have an oil crisis plus the money printing

[13:35] which then led to the worst inflation that we have seen in modern history. It was so bad that the Federal Reserve Bank had to raise interest rates so aggressively

[13:47] that they created a deep recession and extremely high unemployment rates. During that time, you weren't getting a 5 or 6% mortgage, you were looking at a 15, 16, 17, 18% mortgage,

[14:01] because now we're looking at around 20% interest rates. That brought a lot of pain to the economy. But it did save the dollar. It did cool inflation down. and this is where now a lot of investors are looking at

[14:15] what's going on in the economy today and they're saying I hope we don't have to do a repeat of that because that was very painful and this is where the Federal Reserve Bank also does not want to have a repeat of the 1970s and the 1980s

[14:28] which is why Kevin Walsh is hinting that we might have to keep interest rates higher for longer or maybe even raise interest rates now to protect us against inflation because the reality is oil prices are high

[14:41] that's making inflation worse and inflation is not gone. And this is where you want to understand what does the Federal Reserve Bank actually look at with inflation because a lot of people get this wrong. Again, this is why on September 29th

[14:54] I'm hosting my live workshop on how you can take advantage of the dollar losing value because this is a trend that has been going on for a while. So if you haven't registered for it yet, again, that link is for you down in the description. The Federal Reserve Bank cannot fix the economy

[15:08] without causing pain somewhere. Now, the reason why President Trump keeps talking about lower interest rates isn't just because he wants to see lower mortgage rates or lower call loan rates or even lower credit card rates.

[15:20] It's because the United States government has $40 trillion of national debt. Now, this $40 trillion of national debt that the government pays is not a 30-year fixed-year mortgage. A lot of it is readjusting debt.

[15:32] And a lot of that is readjusting now in 2026 because a lot of the debt came during the pandemic era. So now we have this debt that was 2%, 3% interest

[15:45] that is now being reduced at a much higher interest rate, which means the government now has this constraint which is higher debt payment costs because of all the debt, but also because higher interest rates.

[15:58] And so what President Trump wants the lower interest rates for is to lower the debt servicing costs for the national government. because if you could reduce the interest rate that you have to pay on $40 trillion with the national debt,

[16:10] that's a lot of savings. And if you can save that money on the national debt, well then you could take those billions of dollars and inject it into the economy, create jobs or do whatever you want to do, which President Trump says will then help boost the economy

[16:23] to help make our debt problem even less. And this is the situation that we are in. You're going to hear me talk about this a lot right now, because the concern that a lot of people have is if we were to see any sort of pain in the economy,

[16:37] how would we fight it right now? Because there's two types of pain that we could feel. The first type of pain is you could feel any sort of economic pain, a recession. And if we were to feel some sort of economic pain or a recession,

[16:50] normally what you do to help stimulate out of a recession is you print money, you cut interest rates. Well, that's fine, but none of the previous recessions that we've had

[17:02] had inflation as a concern going into the recession. When the 2020 pandemic hit, nobody was concerned about inflation before the pandemic hit. It was after the money printer was turned on.

[17:14] During the 2008 crash, when all the quantitative easing happened and interest rates were cut, nobody was concerned about inflation going into the recession. It became a concern as we stimulated out of the recession.

[17:26] During the 2000 dot-com bubble bursting, nobody was concerned about inflation going into that bubble. they were concerned about inflation as we try to inflate and stimulate our way out of that crash. But here we are today when inflation is a problem.

[17:39] We are in a quote healthy economy right now. We're not in a recession. The economy is growing. But inflation is a problem. If the economy were to struggle well how would we stimulate ourselves out of that?

[17:53] We don't have the ability to just print more money or cut interest rates without creating more pain or consequences because inflation is already a problem. On the flip side, we could see other pain, which is the dollar.

[18:05] What if the dollar loses more value? What if we see more inflation? How do we solve that? Well, the way you solve that is by raising interest rates. And that raising of interest rates has other consequences,

[18:17] which is higher interest rates mean less spending, less people buying houses, less people buying cars, less people putting money on their credit cards. That means realtors make less money. That means mortgage bankers make less money.

[18:30] That means banks make less money. That means title companies make less money. That means contractors and Home Depot and Lowe's make less money because people are buying houses. So you can start to see the impact of that on the broader economy.

[18:42] Not to mention that higher interest rates also put downward pressure on asset prices, things like stocks and real estate. It doesn't mean that asset prices go down. It just means that it puts downward pressure on those asset prices.

[18:54] And this is why the Federal Reserve Bank now is getting a little bit concerned and is getting a little bit nervous. so you can hear from the tone of what they want to focus in on. Because what we've heard time and time again is that inflation is under control and everything is good,

[19:07] but now we're starting to see more concerns about prices are too high. We must focus in on this And we have not hit our inflation target yet which what is the inflation target Why does the Federal Reserve Bank say that they want 2 inflation

[19:22] Which I always find is very interesting, because on the Federal Reserve Bank website, they publicly state that they are aiming for an inflation target of 2%. But nobody really questions that.

[19:34] Why is it 2%? Why not 3% or 4%? Because if it was 3% or 4%, now our inflation problem doesn't look so bad. Well, why is it not 1%? Actually, why is it not 0% inflation?

[19:47] Because we know that inflation makes the average person poorer, because we know that not just for the last six years, but over the last many decades, the average person's income has not kept up with inflation,

[20:00] which means the average paycheck buys less stuff today than it could five years ago, than it could 50 years ago. and the reason why the Federal Reserve Bank sets a 2% inflation target

[20:12] is because 2% inflation is low enough that the average person doesn't notice it day to day but that 2% inflation is driving up asset prices and who does that make rich? It makes the investors richer.

[20:25] Again, this is why September 29th, they have a whole workshop on this. If you haven't registered, that link is for you down in the description. But our economic system is designed to make investors rich because our economic system runs on spending.

[20:39] When people spend money, who gets rich? It's not the workers, it's the investors. Well, now when you have inflation tied in, inflation drives up asset prices. Why? Because now you've got to spend more money when you buy things.

[20:52] When you spend more money at Chipotle, Chipotle's investors get richer. So inflation also makes the investor rich. And so when you understand that the Federal Reserve Bank is working to make investors richer,

[21:06] it should hopefully help you understand how you should be using your money. Instead of just working to save money and just working for a salary, you want to also become an investor.

[21:19] Because when you become an investor, you can win in the economic system. Because in this economic system, the people that become wealthy are not the workers, it is the investors. And it's very unfortunate because we're all taught to be workers,

[21:31] myself included, we're taught to get a good job but we're never taught how to invest our money that's why I started this channel is because I was so frustrated that I was told that I should just go out and get a good job get a good degree become a doctor

[21:43] and everything would be great but what you don't realize is you can make a great salary you can have a great career but if you don't understand how to build wealth or reinvestment you're fighting and working against the system you're swimming against the tide

[21:56] but if you can learn and build your education and learn how the system works Now you can use the education to grow your wealth in this economic system. Investing in money is hard and on this channel I teach how you can start investing your money

[22:11] yourself. But for some of you working with a financial advisor, somebody who is a professional will be a better option because now it's more hands off and you can work with a professional who will manage and invest your money for you.

[22:23] And that's why I partnered with my sponsor Money Pickle. The reason why I like Money Pickle is because first they get to know you and what your needs are and then they match you with a vetted financial advisor who will be best suited for your needs and

[22:35] then they give you a free consultation call with the financial advisor that way you can get a feel of the financial advisor and see if they're right for you or not that way you don't have to go through a high pressure sales process with somebody who might not even be a good fit for you if you're

[22:51] interested in learning more and you have over a hundred thousand dollars in assets the process is pretty simple all you have to do is complete a short form i have that link for you down in the description. It takes a few minutes to complete and once you do that, Money Pickle will review

[23:04] your answer and then pair you with a vetted financial advisor who they believe is best suited for you. It's a completely free process. That initial consultation, again, is free. And then if you decide to move forward, then you can negotiate and discuss what your rate

[23:18] and terms look like with that financial advisor directly. So, if you want help managing your money and you want to work with a vetted financial advisor, my sponsor, Money Pickle, can help get you paired up with a financial advisor at no additional cost. If you want to learn more,

[23:32] I have that link for you down in the description. So, what we talked about in this video is that on September 16th, the Federal Reserve Bank is going to be meeting to make the next decision on what they want to do to save the dollar and save the economy, and it is going to be a big decision

[23:45] because President Trump wants to see lower interest rates. The Federal Reserve Bank has made it clear that inflation is a problem. To fight inflation, you need to raise interest rates. to stimulate the economy, you need to cut interest rates.

[23:58] The Fed cannot raise and cut interest rates at the exact same time. So September 16th, we're going to get that guidance as to what the Federal Reserve Bank wants to do. The reason why this matters to you is because the Federal Reserve Bank

[24:10] is the entity that decides what they want to do with money printing and interest rates, and that has a direct impact on the value of your paycheck, the value of your savings, and the value of your investments. So as you start to think about your retirement,

[24:23] you start to think about how you're going to build wealth you start to think about your financial freedom you want to pay attention to the economic policies that are being set by the Federal Reserve Bank because that can change which investments

[24:35] are set to do well versus others. And so we know that if the Fed decides that inflation is a bigger problem they will keep interest rates higher for longer and maybe even raise interest rates. If they decide that the economy is a bigger problem

[24:49] then they might decide to cut interest rates and whichever thing they decide to do, that's what can move markets. Now, both of them have consequences. You cannot fix any pain in the economy

[25:02] without causing pain somewhere. And that's why it's so important to watch what's going to be coming on September 16th. So, if you got value out of this video, the best thank you is a referral. So, if you could, please share this video with a friend,

[25:15] family member, colleague or fellow investor. That way we can continue to spread this type of financial education. Thank you. For most of the last 15 years, it was cheaper for you to buy a house than it was to actually rent a house. But now that has flipped.

[25:28] It has become so expensive to buy a house that we're now turning into a buyer's market because sellers can't sell their houses, so they're cutting prices and giving concessions because buyers are saying, it's cheaper for me to rent. This is where things get weird.