You realize resistance will come. With the S&P index up 9.1% in July, Federal Reserve officers are pushing again towards two key market sentiments: the Fed is “pivot” and “we’re in a recession.” Neil Kashkari, the president of the Federal Reserve Financial institution of Minneapolis, instructed on Friday in an interview with the New York Occasions that the market has gone forward of itself in predicting that the Fed will finish its fee hike program, mentioned that the Fed was “united in our dedication to carry inflation again to 2% … and we’re removed from that.” In two weeks, the bulls have stepped up the narrative. “pivot”: that fee hikes are all that’s wanted, that the Fed will begin easing will increase by yr’s finish, that the Fed will reduce internet rates of interest in 2023, and that’s the time to go. advance and purchase progress shares. Fed Chairman Jerome Powell tried to push again on this story throughout his press convention final week, the place he famous that the Fed continues to be anticipated to lift charges in 2023, not decrease them. However the bulls don’t need to hear. There was additionally a rebuttal to the inflation story Atlanta Fed President Raphael Bostic informed the Wall Avenue Journal “I don’t suppose we’re in a recession,” Powell mentioned. Bostic famous robust employment progress, “which reveals that the economic system has lots of momentum.” It could not matter. Kashkari made one other look this weekend, this time Sunday on CBS’s “Face the Nation,” the place he mentioned, “We’re going to do every little thing we will to keep away from a recession, however we’re dedicated to decreasing inflation and we are going to do what we have to do,” he mentioned. “We’re a good distance from getting an economic system again to 2% inflation. And that’s the place we have to be.” Others merely discourage folks from utilizing the “R” phrase, suggesting that this present financial panorama is, nicely, only a bit odd. “That is probably the weirdest economic system any of us have ever seen or will see once more in our lives,” mentioned Ben Carlson of Ritholtz Wealth Administration over the weekend. “Covid crashed the economic system, then all that stimulus despatched us up sugar and now the hangover. We don’t know if that is the kind of hangover that’s merely asking for. some greasy meals to cross up or it’s a Las Vegas hangover the place you are feeling like crap for 3 days afterward.” We’ll see. Chicago Fed President Charles Evans, Cleveland Fed President Loretta Mester and St. Louis James Bullard all appeared in public on Tuesday. July has been a constructive month for merchants Preliminary influx information for ETFs reveals some sizable inflows into bond funds of all kinds, together with authorities (iShares US Bond Bond ETF (GOVT)), company (iShares Funding Grade ETF (LQD)), and even excessive yield (iShares Broad Excessive Yield Company (USHY)). Dividend ETFs stay fashionable as a defensive strategy to play the market (Invesco Excessive Dividend Low Volatility (SPHD)). Study extra about July ETF flows on ETF Edge at 1pm this Monday when our friends will likely be Ben Slavin, international head of ETFs at BNY Mellon, and Andrew McOrmond, managing director. at WallachBeth Capital.