Felix Prehn, the mind behind Goat Academy, recently shared some eye-opening news about the Federal Reserve (Fed) and its impact on the stock market. If you’re wondering what’s happening with the economy and how it affects your money, this is for you. Let’s break it down in simple terms.
The Fed is like the big boss of money in the United States. They decide how much money is out there by “printing” it or taking it away. Felix explained that since the COVID-19 pandemic started, the Fed added a massive$7 trillion to the money supply. That’s a huge number—trillions of dollars! This money didn’t just sit around; a lot of it went into the stock market, which is why stock prices have gone up so much in recent years.
Now, here’s the surprising part. The Fed said they took some of this money back, but Felix points out they didn’t really do that. The total money out there is still at its peak, around$22 trillion. And if certain leaders get their way in the coming years, even more money might be printed. What does this mean for you? More money often means higher stock prices, but it can also make things more expensive, like groceries or gas. This is called inflation, which means your money buys less than before.
Felix also shared a cool trick to understand the stock market. He showed that stock prices, especially for big tech companies like those in the NASDAQ (a group of tech stocks), move up when there’s more money around. So, if you’ve made money by investing in these stocks, it’s not just luck—it’s because of all this extra money floating around. But not all stocks are equal. Some, like NVIDIA, have grown way more than others, jumping by 500% or even 1,000% since the pandemic. Felix says smart investors pick these winners instead of just sticking to average stocks.
Why does this matter? Knowing how money printing affects stocks can help you decide where to put your savings. Felix warns that just following the crowd or sticking to safe, average investments might not get you far. Instead, learning which stocks or sectors (like tech or energy) will do well can make a big difference. Plus, with more money printing likely on the horizon, it’s a chance to grow your wealth if you’re prepared.
For those curious to learn more about smart investing, check out Goat Academy for resources and guidance on building your financial future. Felix and his team are all about helping people understand these big ideas in a simple way.
In short, the Fed’s actions are a big deal for everyone. They’ve pumped trillions into the economy, pushing stock prices up, but also creating challenges like inflation. Felix Prehn and Goat Academy are here to cut through the noise and help you see the real picture. Keep an eye on the market, and think about where the smart money is going. That’s the key to staying ahead.