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☕ DrinkCoffeeAndProfit
Smart money moves before breakfast
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Inspiration Quote for the Day
“The four most expensive words in the English language are: this time it’s different.”
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The Morning Ritual
In 7 Days, the Fed Gets a New Chair. Your Mortgage Rate Doesn’t Know Yet.
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My buddy Greg refinanced his house last March. Locked in at `6.9%` and called me like he’d won something. “Best rate they had,” he said. I told him to wait. He told me waiting was a luxury for people without two kids in braces. Fair point.
This morning, Greg’s rate is still `6.9%`. The Fed chair who set the tone for that rate has `7` days left in the job. And the man replacing him just cleared the Senate Banking Committee on a vote so partisan it made history. That is worth one more cup of coffee before you do anything.
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In One Sip
▸ Kevin Warsh passed the Senate Banking Committee `13`-`11`, strictly along party lines. It is the first fully partisan committee vote on a Fed chair in the panel’s history.
▸ The full Senate vote is expected the week of May `11`. Jerome Powell’s term expires May `15`. Powell said he will stay on as a Board governor.
▸ At the April FOMC meeting, `4` members dissented from the rate decision. That is the most since October `1992`. The fed funds rate held at `3.50`%-`3.75`% for the third straight meeting.
▸ The `30`-year fixed mortgage averaged `6.37`% this week, per Freddie Mac. A year ago it was `6.76`%.
▸ Of those `4` dissenters, `3` opposed language suggesting future cuts. One wanted a cut now. The incoming chair wants cuts too. The people who actually vote are telling him: not so fast.
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Why It Matters for Your Money
A new Fed chair does not flip a switch on mortgage rates. But the signal matters. If Warsh walks in talking about cuts, bond traders start positioning before the Fed acts. Here is the math that lands on your kitchen table.
A `$350,000` mortgage at today’s `6.37`% costs you `$2,185` a month. If rates dropped `75` basis points to `5.62`%, that same loan costs `$2,014`. That is `$171` a month. Over `30` years, it is `$61,560` less in interest. Not a small number.
I think the market is pricing in too much optimism on rate cuts. Warsh may want them. But `3` of the `4` FOMC dissenters pushed back against even hinting at future easing. Core inflation is running `3.3`% year over year. Oil prices spiked from the Iran conflict. That is not the backdrop for aggressive cuts.
Greg heard “new chair” and texted me: “Should I refinance?” I told him what I am telling you. Not yet. Not until the June meeting tells us whether Warsh has the votes or just the title.
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· · · PARTNER MESSAGE · · ·
The Trump Fed Takeover: One Ticker Before May 15
Editor’s Note: Larry Benedict — the hedge fund legend who beat the S&P 500 by 18 times in 2025 and made his clients $95 million during the 2008 crisis — says Trump’s installation of a new Federal Reserve chair is triggering the most significant shift in U.S. markets in nearly 20 years. He has already identified the one ticker he believes will be at the center of the money flows — and he’s revealing it completely free. Click here to see the details or read more below…
Dear Reader,
The market is about to fall.
Two years later, Larry told a reporter that another massive collapse was coming.
Again, few believed him.
The S&P fell 20%. The Nasdaq lost a third of its value.
But Larry went 11 for 11 that year, including recommending one trade that returned 117% in under a month.
Now Larry Benedict is speaking out again.
He says a historic shift is coming to the Federal Reserve on May 15 and what follows will likely create the biggest divide between market winners and losers in nearly 20 years.
He’s urging everyone he knows to get positioned in one specific ticker before it arrives.
Best wishes,
Lauren Wingfield
Managing Editor, The Opportunistic Trader
P.S. The last time the Fed made a shift this significant — 2022 — Larry’s readers had the chance to double their money in under a month.
· · · END PARTNER MESSAGE · · ·
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The Wealth Angle
Everyone is watching Warsh. I am watching the dissenters.
JPMorgan’s Bob Michele called the April vote “a message to the incoming chair.” Three regional Fed presidents publicly broke ranks to say: we are not cutting just because you want us to. That has not happened in `34` years.
Here is why that matters more than who sits in the big chair. The FOMC has `12` voting members. Warsh replaces Miran’s seat, not Powell’s, because Powell is staying on as governor. The `3` hawks who dissented in April will still be voting in June. Warsh can set the agenda. He cannot overrule a committee that disagrees. No Fed chair in history has lost a vote on monetary policy. I doubt Warsh wants to be the first.
The real move is not the chair. It is the `10`-year Treasury yield. If bond traders believe cuts are coming, mortgage rates drift lower before the Fed acts. If the dissenters hold firm, the yield stays elevated and your `6.37`% is not going anywhere.
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☕ Key Insight:
A new Fed chair sets the tone, not the rate. The `3` dissenters from April still vote in June. Watch the `10`-year yield, not the headlines.
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Coffee Break Move
Pull up any variable-rate debt you carry. Home equity line, adjustable-rate mortgage, business credit line. Write down the current rate and the margin above the index. If that margin is above `2`%, call your lender today and ask what a fixed conversion costs.
If you are sitting on a fixed-rate mortgage above `7`%, set a rate alert on Bankrate or Zillow for `5.75`%. That is your trigger to refinance. Do not refinance on hope. Refinance on a number you chose before the noise started.
Greg asked me when to move. I told him the same thing I am telling you: pick your number before the crowd picks it for you.
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