“But will the Fed engineer a soft landing? I doubt it. They have a terrible track record. There have been soft landings just 10% of the time when they’ve been raising interest rates,” she says.

Right now Link says she likes investing in industrials, materials and discretionary sectors, at least through December. And she’s overweight in financials, but it’s part of her tilt toward value—and not part of a “not-recession soft landing.”

“And then I’ll see,” she says. “Between now and the end of the year can be an eternity.”

A Hard Landing Most Likely Ahead
Since the Fed is clearly continuing in its pursuit to beat down inflation, advisors say, it will be left to investment professionals to get ahead of the looming recession story.

“Inflation was the strongest risk factor coming into this year,” Blackwell says. “And as we look at the inflation numbers now, it’s really telling a story that we expected.

“A lot of our conversations this year have been deconstructing the GDP number,” he says. “When we look at the real number, the net number that’s growth minus inflation, growth is very robust.”

With that in mind, he has strongly dedicated his investments to real assets and inflation-sensitive assets, like real estate, infrastructure and commodities, he says, adding that he just introduced a high-dividend equity exposure that bumped up dividends and gave clients a value tilt.

“Right now we’re aggressively core, and pretty optimistic over the next 24 months, though it’s sort of an awkward world we’re living in where big numbers are punished and small numbers are celebrated,” he says of the inclination to avoid big swings by being satisfied with more modest, but steady, results.

But there could be tacks in the road, thanks to the Fed doing its yeoman’s work against inflation. “Did they go too far?” Blackwell asks. “We’ll know in six to nine months.”

Grecsek and other professional investors worry more about the Fed overtightening than the folks strolling Main Street.

“We are seeing wage pressures elevated, and that’s not good news,” he says. “We always acknowledged the [two-year U.S. treasury note and the 10-year note] were inverted earlier in the year, but now they’re unambiguously inverted. … The odds of a Fed pivot is low, the odds of a soft landing is low, and the risk of recession is high.”

Grecsek says he used the market pullback earlier this year to upgrade the quality of investments across the board.