Memorial Day, Summer Rays and the Chill to Come

I'm taking off today for Memorial Day, a holiday that the United States celebrates to commemorate the lives of those who have died in the line of duty for their country. It's also the symbolic start to the summer. For those from the States with a penchant for living life to the fullest in the summer months, this means that its time to take out the linen sailing whites, Nantucket reds, seersucker, etc. It's also time to replace the single malts with G&T, Pimm's, etc. -- not to mention trading out big Shiraz's for crisp Sauvignon Blancs.

This year, I'll leave you with one Spend Management lesson as we head into the summer. And that's the importance of not mistaking the changing weather with a changing economic climate. Sure, we'll see various perk-ups in spending in some areas as companies and individuals invest in various projects that are best done in the summer months. But make no mistake about it: we're still very much in a recession. And those companies who dismiss this whole supply risk thing merely as an overhyped passing fancy will surely be left holding a costly bankruptcy bag once the winter weather returns.

Seriously, our biggest concerns right now should not be hangovers from summer cocktails on Tuesday morning -- they should be from the hangovers from out of control deficit spending, still limited bank liquidity, rising unemployment, stimulus that is failing to make its way into the economy quickly enough and the specter of inflation which the Fed is already warning about. And that's a tipple whose consequences we should should not avoid taking our eye off of for a minute. Despite the fact that I'm as perennial an optimist as they come, I believe all the signals are pointing to supply risk getting worse before it gets better. Even if you're able to catch a few rays along the way this summer, don't get blinded by the temporary light.

Jason Busch

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