There’s a major event looming, but it’s not what everybody thinks. This time around, what’s important is not the size of the interest rate hike that the Federal Reserve is about to impose, but what Chairman Jerome Powell says afterwards.

In the February 1 FOMC meeting, the central bank is widely expected to raise the federal funds rate by 25 basis points, or 0.25%. That’s in contrast to the more aggressive 0.5% interest rate raise from December, and the four consecutive supersized 0.75% rate hikes prior to December.

The mini-hike is pretty much a foregone conclusion at this point. Oddsmakers almost universally agree on the 25-basis-point rate raise for the current FOMC meeting, to the point where anything bigger than that could induce a sharp correction in the stock market.

If there is a mini-hike as expected, don’t assume that there will be a massive relief rally in stocks. That already happened in advance, throughout the month of January. Therefore, don’t just tune out after the 2:00 p.m. EST FOMC announcement. More important, most likely, will be what Powell has to say when he briefs the media at 2:30 p.m. EST.

One thing is assured: The media will analyze every word Powell says. If he says something hawkish-sounding, it’s possible that stocks will plunge in the aftermath.

It’s possible, but not probable. That’s because everyone and his uncle already expects Powell to indicate that the central bank doesn’t have any near-term plans to pause interest rate hikes or pivot to rate cuts.

Courtesy: Bloomberg

Or, as CNBC put it: “Market pros are expecting Fed Chair Jerome Powell to sound hawkish, meaning he will lean toward tighter policy and keeping interest rates high.” Stock market crashes don’t typically happen when there’s no element of surprise, so a fully expected hawkish Fed won’t likely rattle the market very much.

Besides, equities traders know full well that central bank policy and Fed talk can change on a dime. Remember how quickly Powell pivoted from interest rate hikes in late 2018, to rate cuts in 2019? And, remember how Powell shifted last year from “inflation is transitory” to “inflation isn’t transitory”?

When listening to the Fed chairman’s tough talk, assume that it could easily change in a month or two. Don’t assume, however, that January’s stock market rally can’t continue into February.

93% Of Investors Generate Annual Returns, Which Barely Beat Inflation.

Wealth Education and Investment Principles Are Hidden From Public Database On Purpose!

Build The Knowledge Base To Set Yourself Up For A Wealthy Retirement and Leverage The Relationships We Are Forming With Proven Small-Cap Management Teams To Hit Grand-Slams!

    You’ll be amazed, if you’re not accustomed to it, to see how quickly and easily the stock market climbs the wall of worry. To quote Rick Rieder, BlackRock’s chief investment officer for global fixed income, “I think if he’s hawkish, I think the markets have built that in. I think if he’s not, the market could make another leg.”

    Also, consider the Federal Reserve’s actions more than its words. If the Fed only raises its benchmark interest rate by 25 basis points after four 75’s and a 50, this will speak much louder than anything Powell has to say about it.

    Additionally, think about why Powell is hiking the fed funds rate. More than anything else, it’s to contain inflation. If that’s the goal, then it shouldn’t be too long before Powell can declare victory and tap the brakes on rate hikes.

    Courtesy: Bloomberg

    Bear in mind that the Consumer Price Index topped out at 9.1% in June, and has already retraced to 6.5% in December. This certainly isn’t to suggest that products and services are cheap now. They’re still expensive, but the price increases won’t accelerate at last summer’s torrid rate.

    Instead of obsessing over the Federal Reserve, consider paying more attention to corporate earnings. We’re in the middle of a high-stakes earnings season, in which companies and their investors are coming to terms with 2022’s challenging fourth quarter.

    Read the earnings reports carefully, and look for quarterly 10-Q forms to get the full data set instead of only what the companies want to you see. There may be prime opportunities to buy shares of great companies if the prices decline more than is warranted.

    Or, the entire stock market might go down if Powell commits another policy error. If so, I’ll be more than happy to dust off my shopping list and scoop up shares of high-conviction businesses at bargain prices, and will thank the Fed for a job poorly done.

    Governments Have Amassed ungodly Debt Piles and Have Promised Retirees Unreasonable Amounts of Entitlements, Not In Line with Income Tax Collections. The House of Cards Is Set To Be Worse than 2008! Rising Interest Rates Can Topple The Fiat Monetary Structure, Leaving Investors with Less Than Half of Their Equity Intact!

    Protect Yourself Now, By Building A Fully-Hedged Financial Fortress!

      Legal Notice: No matter how good an investment sounds, and no matter who is selling it, make sure you’re dealing with a registered investment professional. Use the free, simple search at

      We are not brokers, investment or financial advisers, and you should not rely on the information herein as investment advice. We are a marketing company. If you are seeking personal investment advice, please contact a qualified and registered broker, investment adviser or financial adviser. You should not make any investment decisions based on our communications. Our stock profiles are intended to highlight certain companies for YOUR further investigation; they are NOT recommendations. The securities issued by the companies we profile should be considered high risk and, if you do invest, you may lose your entire investment. Please do your own research before investing, including reading the companies’ SEC filings, press releases, and risk disclosures. Information contained in this profile was provided by the company, extracted from SEC filings, company websites, and other publicly available sources. We believe the sources and information are accurate and reliable but we cannot guarantee it.

      Please read our full disclaimer at