It's never too early to begin thinking about tax-loss harvesting and there is a ripe situation in the bond market. The yield curve has been on the rise due to Fed tightening and inflation. Rising yields mean lower bond prices and ETF owners have taken a bath. Selling off those funds right now could give you a tax advantage later this year. However, investors should get out of the fixed income route altogether. Markets are beginning to show signs of a recession or straight volatility so replacing your bond ETF with another fixed-income ETF could help in the case of a recession. Or if bond prices begin to take off it's a good option to have some skin in the game.

Finsum: The wash rule makes harvesting losses in equity markets a bit difficult, but the plethora of bond funds and options gives investors better ability to harvest losses now.

Recent events have dramatically shifted the balance of supply and demand within the oil market, driving prices higher. Will this trend continue? 

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The bond market has taken a beating and investment-grade debt has been anything but a safe haven for income investors. This has been one of the third-worst stretches in history as the YTD returns have been -10.5% which is only bested by the Lehman collapse in late 2008 where returns crept to -14.3% and Volcker’s days of battling high inflation and hiking rates. Investors are selling off investment-grade debt as the risk-free rates on Treasuries are climbing as the Fed’s tightening cycle is beginning. These rising yields are all corporate bond ETFs and driving returns down, but things could get worse as rates will only continue to rise and inflation is only beginning.

Finsum: Income investors need to look to active funds or abroad if they want relief in the bond market.

Stagflation has been out of the public lexicon since the Greenspan era, but as inflation begins to gradually creep up again that word is beginning to seem like a higher probability. Inflation has climbed to 8.5% and growth is expected to slow dramatically for 2021Q1 to 1.7%. Small-cap is a great option during these times because they are a great alternative partially in Finance. Preferred Bank is a great option with earnings estimates rising and is moving into a bullish category on Wallstreet. Others to watch out for are Mercantile Bank Corp and Old Second Bancorp as they are also well-positioned small-cap financials to stave off stagflation.

Finsum: It's amazing that equities are the most stabilizing force on Wallstreet right now, but small-cap might just be the play as volatility rises.

President Biden announced he is going to nominate Michael Barr, former Assistant Secretary of the Treasury and current dean of the University of Michigan's Public Policy School, for the Feds Vice Chairman of Supervision. Previously nominated Sarah Bloom Raskin pulled her nomination with harsh criticism from Republicans because she argued the Fed should discourage lending to traditional energy companies. Barr will be stepping into a difficult role but has experience in Government. He helped create the Consumer Financial Protection Bureau. Critics have said that Barr had been easy on bank regulations during the Obama admin and others were suspicious as to his role with Lending Club and Ripple Labs.

Finsum: This is a relatively new position but it has critical regulatory power for the financial system.