Axe's Guide to Navigating the Summer Sh*tstorm: Make Income Great Again

Brace Yourselves Winter is Coming... in July

Alright people listen up. Wells Fargo bless their cotton socks is telling you to prepare for a bumpy ride. They're predicting market volatility through the summer. Translation? The sh*t's about to hit the fan. As I always say 'What's the point of having f*** you money if you can't say f*** you?' Well right now the market's about to say it to you. Their 'top five portfolio ideas' for the rest of 2025? Generating income. Groundbreaking I know. But let's see what they're peddling.

Treasuries? More Like Treacherous uries

So Wells Fargo's head of global asset allocation Tracie McMillion is touting fixed income assets. Steady cash flow she says. 'Optionality,' she calls it. I call it damage control. The Treasury market's been doing the tango lately but she seems to think bonds are the way to go. 'Cash coming into a portfolio can be very important,' she chirps. No sh*t Sherlock. Cash is king. Always has been always will be. Remember 'A person allows himself to be defined by their possessions; I don't do that'. But it sure as hell makes the ride smoother.

Fireworks and Financial Fiascos: The Trump Card

Limited upside for stocks this year Wells Fargo projects with a recovery in 2026. The S&P 500 supposedly hitting 6,500 by the end of 2026. But between now and then? Choppy waters. A 5% to 10% pullback they say. Why? A 'convergence' of news events in July and August according to Darrell Cronk. Namely the expiration of Trump's reciprocal tariffs and his 'big beautiful bill' of tax cuts. Fireworks he calls it. I call it a clusterf*ck waiting to happen. 'Money doesn't solve problems it just puts them in a nicer box'. This time the box is lined with nitroglycerin.

Bondage for Beginners: The Intermediate Game

To generate this oh so critical cash flow Wells Fargo favors intermediate term fixed income. Short and long term bonds are apparently too risky. Too much Fed action too much fiscal foolishness. They like the five to seven year maturities. 'Attractive income' and 'less volatility,' they claim. One area they're fond of? Investment grade corporate bonds. Specifically the iShares 5 10 Year Investment Grade Corporate Bond ETF. Telecom issuers financials and utilities are their darlings. Residential mortgage backed securities and asset backed securities get a nod too. Reminds me of that time I played the housing market... good times! This is not a game of pennies this is war!

Muni Mania: Tax Breaks and Broken Promises?

Municipal bonds are also getting some love from Wells Fargo particularly general obligation bonds and essential service revenue bonds. Brian Rehling is singing their praises citing attractive yields and tax advantages. Income's free of federal tax and if you're lucky state tax too. They even address the potential threat of Congress axing the muni tax exemption to offset Trump's tax cuts. 'Extraordinarily unlikely,' they say. Famous last words. But hey if you can squeeze a few extra bucks out of Uncle Sam why not? Just remember 'The less you have the more you stand to lose'. So watch your ass.

Beyond Bonds: The Axe Man's Alternative Plays

Finally Wells Fargo suggests diversifying into dividend stocks particularly in the energy sector. They're also keen on utilities and financials. Midstream energy electric utilities and renewable energy producers are apparently benefiting from 'strong fundamental positioning' and 'secular growth in power demand.' They own 'difficult to replicate assets,' like pipelines and nuclear power plants. Lastly they mention direct lending. High yields for qualified investors. The Cliffwater Direct Lending Index yielded 11% as of December 31 2024. Now that's what I'm talking about! 'I am not a man who enjoys things in moderation.' 'I like things that are excessive.' So there you have it. Wells Fargo's roadmap for navigating the summer sh*tstorm. Take it with a grain of salt. Do your own homework. And remember in this game only the paranoid survive. Or you know just give me a call. I've got people for that.