Fed Hikes Again: History Says They’re Wrong, September 16, 2026

— Ben, Find Better Trades

Another Fed meeting, another move. They just hiked rates again, trying to slow down those rapidly rising longer-term yields.

Don’t fall for it. History tells us this won’t work.

What Just Happened

The Federal Reserve’s FOMC just announced another interest rate hike. Their stated goal is to curb the rapid increase in longer-term bond yields.

This is their play to cool the economy and bring down inflation. They think higher short-term rates will translate to lower long-term rates.

The problem? History disagrees. Past Fed hikes, intended to slow long-term yield growth, usually fail to do so.

What It Means for Your Trades

If the Fed can’t stop longer-term yields, then expect continued pressure on growth stocks. These companies rely on cheap money, and higher borrowing costs hurt their future earnings.

Tech and other high-multiple names will feel the squeeze. Consider trimming positions or looking at inverse ETFs for these sectors.

Financials, on the other hand, often benefit from a steeper yield curve. Banks make more money when they can borrow short and lend long.

Look at regional banks and larger financial institutions. They could see tailwinds from this environment.

My Take

I’m not buying the Fed’s narrative here. They’re fighting a battle history says they can’t win when it comes to long-term yields.

This means we’ll likely see continued pressure on growth-oriented sectors. Don’t expect a quick rebound there.

My stance is bearish on rate-sensitive growth. I’m bullish on financials and value plays that can weather higher rates. Conviction: high.

Macro Pulse FAQ

Q: Why do rising long-term yields hurt growth stocks?

A: Growth stocks are valued on future earnings. Higher long-term yields mean future earnings are discounted more heavily, making them less valuable today.

Q: What sectors benefit if long-term yields keep climbing?

A: Financials typically benefit from higher long-term yields. Energy and industrials can also perform well in an inflationary, rising-rate environment.

Q: Is it time to buy bonds?

A: Not yet, in my opinion. If the Fed can’t control longer-term yields, bond prices will likely continue to fall as yields rise. Wait for clearer signs of a top in yields.