Stop Waiting for "Rate Cuts." Here's How to Build an 8% Yield Portfolio Even if the Fed Holds Rates in December

"The Federal Reserve was shying away from cutting rates as the inflation slowdown stalled and started to reverse after tariffs. Thankfully, tariffs have not led to a massive increase in inflation, and this has allowed the Fed to continue cutting. There have already been two rate cuts so far this year. The market puts a 93% chance that another interest rate cut will happen this December."

"The Federal Open Market Committee will meet on December 10 to decide whether or not to hold or cut. Despite the market overwhelmingly expecting a cut, Powell has said that it is far from a foregone conclusion. If a report comes in that shows inflation getting worse or the labor market getting better without intervention, it might incentivize the Fed to pause."

"Plains All American Pipeline is a midstream company that transports and processes crude oil and natural gas liquids. The company does not directly have exposure to oil and gas prices. It makes money off the volume and has fee-based contracts that keep the cash flowing, rain or shine. PAA stock is up 83.27% over the past five years, and that's without counting the gargantuan dividend."

Markets price a high probability of another Federal Reserve rate cut in December after two cuts earlier this year, supported by the lack of a massive inflation surge from tariffs. The FOMC meets on December 10 to consider holding or cutting rates, while Fed Chair Powell cautions that a cut is not guaranteed if inflation worsens or the labor market strengthens. Investors can pursue higher yields now rather than wait for potential cuts. Plains All American Pipeline operates midstream pipelines with fee-based contracts, offers an 8.74% forward yield, and has seen strong five-year performance. Hercules Capital is a BDC focused on venture lending, and BDCs are known for high dividend yields.

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