the 2022 edition of the stock market is probably going to be a mess with the federal reserve pausing its money printing we are likely to see “flights to safety” that will feature—believe it or not—our favorite dividend stocks yes it’s all fun and games in the techandcrypto casino when the fed is pumping billions into the bond market every month its purchases of course were funded by money that the fed itself printed out of thin air this capital flowed into speculative assets like the nasdaq in 2020 and coins with dog faces in 2021 the trendy stocks of 2022 are likely to be our style as vanilla investors leave the betting tables some of the more sober participants are likely to focus on quality and cash flows of all things what a nice contrast it will be for us contrarian income investors the reliable retirement investments we’ve been buying all along are likely to become quite popular of course the basic types will talk about dividend stocks as if they are all created equal they are not as with any equity the economic backdrop and business model matter this time last year the fed was “buying” 120 billion in bonds every month again “bond buying” is a polite way of saying “money creation” chairman jay powell has been a prolific printer of greenbacks  we can see this reflected on the fed’s ballooning balance sheet chairman jay powell piled the central bank’s balance sheet higher by a cool 45 trillion—more than a 100 increase since the start of 2020 while powell was literally minting money he likewise had shortterm interest rates glued to the floor he pledged to keep them there through 2021 which he did powell also helped prop up the economy with massive liquidity while engineering higher inflation which meant higher longterm rates meanwhile by keeping shortterm rates low firms that “borrow short” saw their bottom lines boom as the spread between their borrowing costs and lending profits popped in relative terms it was a huge windfall which is why in this exact column one year ago we discussed synovus financial snv as my favorite dividend stock for 2021 since that column snv soared 39 including dividends congratulations if you saw the upside in snv and enjoyed these 39 gains and very well done if you bought snv even earlier—say on our april 2020 recommendation in contrarian income report if so you are sitting on 178 total returns and counting but can we count on another rocket ride from snv in 2022 i’m not so sure the general bank backdrop looks quite a bit different now than it did 12 months ago   the fed is being forced to kick its moneyprinting habit   shortterm rates are likely to rise in ’22 the potential implications here are compressed profits for banks like snv now don’t get me wrong i’m not worried about its dividend but we need to recognize that a repeat of snv’s 2021 and late 2020 moonshots is unlikely number three above—the upside of longterm rates—is the potential wildcard and the reason we’re not bailing on our bank positions yet powell has been buying bonds with other people’s money specifically ours so he didn’t care about the price he was paying or interest rate he was receiving the chairman is the reason the 10year treasury yield ended 2021 impossibly low given the high level of inflation around just 15 but now that he is fleeing the market new buyers must step in these new bond shoppers will care more about prices and yields than powell did their discretion may put pressure on the “long end” of the yield curve and protect bank spreads brett owens is chief investment strategist for contrarian outlook for more great income ideas get your free copy his latest special report your early retirement portfolio huge dividends—every month—forever