July 2021

June 30, 2021

Allocation Percentages for July 2021

USAA

USIBX

USAAX

13%

USCAX

69%

USIFX

18%

Fidelity

FCBFX

FOCPX

22%

FDVLX

78%

FWWFX

Vanguard

VBLAX

VIGAX

VSGAX

32%

VFSAX

68%

I had lackluster returns this month for all of my mutual funds. Fidelity recorded a loss of -0.84%, Vanguard -0.47%, and USAA a meager gain of 0.17%. What was surprising is the performance of the mutual funds tied to the S&P500 and broader markets. I had expect the small caps to continue to perform above average and even expected the international funds to have some positive upside. However, movements in the current US economy are placing more cash into the stock market than ever before. I caution everyone is not get used to these types of returns. The average S&P 500 returns outside of these abnormal years and in non-recession years is at best 8%. At some point, there will be a reversion as our economy and the companies in the S and C Funds are not growing at 20-30% a year. Rather, we are seeing the effects of the inflationary monetary policy moving liquidity to the markets and into stocks. The reports continue to come out about inflation and whether it is transitory or permanent. If it is transitory then, by nature we would expect deflation in a transitory sense as well. In either scenario, transitory or permanent-both are not good. At some point, the Federal Reserve will have to act when the velocity of money or the amount of money in circulation reaches a tipping point. What that tipping point is, is still anyone's guess. I am of the belief that any interest rate hikes are still several quarters away. We are in a recovery mode, and unemployment benefits are still preventing full employment. There will be a hesitancy to raise interest rates until the IS-LM-FE curves are in better alignment. As a result, I'm shifting more towards the broader market while still hedging some of my investments in the international funds and small caps. I think the small cap rally will start to level out (especially over the summer), while the broader market funds will continue to be decent and we might see some improvement in the international markets as well. Have a great Independence Day holiday and long weekend! Keep investing!

Date	USIBX	USAAX	USCAX	USIFX
2024-11-15	9.12	41.23	14.53	27.52
2024-11-14	9.12	42.09	14.75	27.63
Daily Change	0%	-2.04%	-1.49%	-0.4%
Month to Date	-0.65%	4.35%	4.46%	-2.1%
Year to Date	-0.72%	29.09%	9.58%	5.89%

Date	FCBFX	FOCPX	FDVLX	FWWFX
2024-11-15	10.48	21.03	16.34	39.65
2024-11-14	10.49	21.56	16.42	40.11
Daily Change	-0.1%	-2.46%	-0.49%	-1.15%
Month to Date	-0.66%	2.64%	3.61%	1.69%
Year to Date	0.16%	14.98%	13.79%	27.45%

Date	VBLAX	VIGAX	VSGAX	VFSAX
2024-11-15	10.62	204.73	98.58	28.88
2024-11-14	10.65	208.94	100.15	28.98
Daily Change	-0.28%	-2.01%	-1.57%	-0.35%
Month to Date	-1.58%	3.83%	5.1%	-2.6%
Year to Date	-5.57%	27.96%	14.45%	1.69%