Welcome to the Dividend Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life.

Welcome back to Dividend Cafe. This is Brian Saitel, your host here with you this evening from Miami Beach, Florida, where David, Trevor, and Joe have all been here with me in a slew of different High Tower meetings with the leadership team that have all gone just tremendous.

It was time well spent and a lot learned and a lot of camaraderie built.

I wanted to thank the leadership team of High Tower.

So Larry, Dan, Doug, Randy, Patrick, Scott, thank you very much. I appreciate it. And we're all heading back out to our respective offices. I'm up in Palm Beach here, recording just a few minutes before the close. I know David is up to New York office. And then Joe and Trevor back out to the California office. But let's wrap up the day here. Positive day and turnaround, frankly,

in the market. The Dow is going to close up 280 points on the day. S&P is going to be up about

15 bases points. NASDAQ is up about 10 bases points. So much more of a blue chip value oriented

core market move on the day in stocks. And on the year, now you have the Dow up about 5%. You have the

S&P up about 9 and you've got the NASDAQ up about 13. And this is not halfway through the year here.

So we're doing just fine as far as risk assets, I guess, in the year of 26. Rates on the day didn't

move much. I'll call that good. And we're at 456 on tens. And then oil was down a little bit on WTI. There was a news reel out of Saudi that there could be a deal eminent this afternoon in the conflict in Iran. Take that with a great of salt. We'll see what plays out there. But that's my little market recap for you on the day, generally a positive one. A couple of things

I wanted to note today. One mainly is about inflation. I've spoken about that yesterday as well,

but the slight and modest re-rating of what terminal fed funds will ultimately be as Kevin Warsh comes

into that chair. The economy is strong. And so what you've seen is the rate of change of demand, the growth of demand, outstripped, the rate of change and the growth of the supply of goods and services.

So that in and of itself isn't going to cause prices to rise, but when you couple that with the rising money supply, then that's what we're seeing here.

We know that because if you strip out food and energy from all of the components, so if you look at CPI, if you look at PPI, all of those numbers are elevated and all of

them in the core space. So that's what's going on. In a free market economy, all impediments removed.

I call those impediments things like over-regulation and over-taxation. Removing those,

you get a market that will ultimately meet demand, and I'm not overly worried about it. There's no

reason this market is any different. So I think the increase in goods and supplies will end up meeting

that demand. But for now, we're seeing the anomalies and the inflation numbers. And then, of course,

if you get a reopening of the Strait of Hormuz, that alleviates a lot of pressure on inflation. But all that to say, it isn't that we're changing our thesis on a 1% real Fed funds rate. That's the same. The difference is simply that the goalpost has moved because inflation was deemed to be two to two and a half, and now it's looking at more like two and a half to three

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