Midyear Investing Outlook: Where to Invest Now

Much hinges on whether the Fed can guide the economy to a soft landing.

airplane struggling to make a soft landing
(Image credit: Illustration by Dan Bejar)

Like any good serial, the financial markets have set up a doozy of a cliff-hanger as investors look toward the second half of 2022. Will inflation moderate or continue to blaze, consuming more of our spending power and investment returns in the process? Will the Federal Reserve manage the high-wire act of raising interest rates just the right amount at just the right pace to dampen inflation without tipping the economy into recession? That’s a balancing act it has pulled off in only three of the past 11 extended rate-hiking cycles, according to Deutsche Bank—a dismal success rate of less than one-third. Will the downward trend in financial markets spiral into a widespread bear market in stocks and more carnage in bonds? Or is a snapback in order if the bad news—including about the invasion of Ukraine and the course of COVID—starts to abate?

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Anne Kates Smith
Executive Editor, Kiplinger's Personal Finance

Anne Kates Smith brings Wall Street to Main Street, with decades of experience covering investments and personal finance for real people trying to navigate fast-changing markets, preserve financial security or plan for the future. She oversees the magazine's investing coverage,  authors Kiplinger’s biannual stock-market outlooks and writes the "Your Mind and Your Money" column, a take on behavioral finance and how investors can get out of their own way. Smith began her journalism career as a writer and columnist for USA Today. Prior to joining Kiplinger, she was a senior editor at U.S. News & World Report and a contributing columnist for TheStreet. Smith is a graduate of St. John's College in Annapolis, Md., the third-oldest college in America.