Although we’re still in June, it feels like summer is already here. Somehow, we skipped past the typical June gloom and moved right into the heat. It also feels like summer for me because my kids got out of school last week. School might be out for the summer, but since my wife and I both work, our kids have a patchwork of camps and activities. My wife has laid out a carefully organized strategy between various families for camps, carpool, and playdates.

Another sign that reminds me of summer being here are farmers’ markets. Honestly, I have been buying less and less at our local Sunday farmer’s market since it’s so darn expensive (see article on food inflation). But one thing I usually see there are peaches. Truly one of my favorite fruits. If there was a flavor of summer, peaches would undoubtedly be it. Unfortunately, my yellow fruit isn’t quite in season yet; they’re not quite ready. And you can tell when they’re ready.

What’s also back are the hot meme stocks from earlier this year. Names like AMC and GameStop have roared back to life. Investors in Lordstown Motors (RIDE) haven’t been so fortunate. These types of trades are obviously high risk, but they can be highly rewarding. To maximize your chances to win against the house it’s important to define your strategy before you get into a situation. Don’t let the situation dictate the strategy. Jason Zweig at the WSJ had a great article that asks, are you an “investor, trader, or speculator”. Know what you are and have a strategy.

This week all eyes will be on Jerome Powell and his colleagues at the Federal Reserve. Markets are anxiously waiting to hear more about their strategy to get us through the next few years. The economy seems like it’s roaring back to life. So, what are they waiting for? Like my peaches, it doesn’t seem like Mr. Powell is quite ready yet, but they are getting there. The Fed continues to watch for signs that the economy is almost ripe and will need higher interest rates. What are some of the signs they are looking for? While we think inflation will remain muted, our strategy is to remain cautious on fixed income. We are wary of taking any bets in longer term (duration) or lower quality (credit) bonds. Our defensive nature should help us if interest rates spike higher. Right now, our strategy is to keep our bonds as the safety net of the portfolio, shortstopping the equities.

/ben