The Flinchum File

Thoughtful Economic Analysis and Existential Opinions
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Welcome to The Flinchum File

I am an Accredited Investment Fiduciary at Bay Capital Advisors, an investment firm headquartered in Virginia Beach, VA. After retiring from Truist Bank, I started this firm to work more closely with a smaller number of clients, and it has been great! Our client load is about 25% of the national average.

Writing is not for the shy or the meek. It exposes a person’s mind and character. I hope you enjoy the view.

The opinions expressed in The Flinchum File are those of the writer, Jim Flinchum, and do not necessarily reflect those of Bay Capital Advisors, LLC

Save Your Breath, America!

The Bush Administration started applying pressure on China years ago, to allow their currency to increase in value. This makes their exports more expensive to foreigners who buy them, like the U.S. As a result, foreigners buy less, which means China produces less, and fewer Chinese workers are needed. Layoffs increase and so does social unrest. The Obama Administration has substantially increased that pressure on…

What Chinese and Americans Have In Common . . . Taxes

The Chinese have a progressive tax on income, which means your tax rate increases as your income increases, similar to ours. However, they have no estate tax, at least not yet. As income inequality increases, so does social instability, which is the greatest fear of the Chinese government and can hardly be emphasized enough. To take more from the rich, there is now growing pressure…

Peeling the Onion….

Last week, I marveled that China was making the same mistake as the U.S. by letting its Social Security system get as out of control as ours. Digging into this has not been easy, but I have learned that: 1. It started in 1978, when China was still a “socialist-paradise”. 2. By 2030, it is expected to be the oldest, on average, population on the…

The Triumph of Madison Avenue

Certainly, one of the most apparent changes in China from my last visit in 1987 is the western style of clothing, which has been completely adopted by the Chinese. It is not unlike a typical walk thru Chinatown in San Francisco. Who said advertising doesn’t work? Yet, this is one of those discussions where business bleeds into ethics quickly. If advertising works for clothing, why…

A Day in the Life of ….China

This nation boasts the greatest number of newspapers, with over 400. It is also accused of having jailed the most jounalists, number unknown. Still, a good read of one day’s edition offer insights into Chinese thinking see www.chinadaily.com.cn: 1. Pressure from the U.S. to allow the Chinese currency (Yuan) to appreciate is not motivated by any trade protection of Chinese exporters but entirely by the…

A Rocker Got it Right

As a child of the Cold War, I just assumed I would die in a nuclear war. When I first heard the song by rocker Sting, called “Do the Russians Love Their Children Too?”, I was caught a little off-balance by the question. Yesterday, I watched an older lady stop a young mother to admire her baby. I saw a man photographing his wife and…

Paging Gloria Steinam

The flight attendants for Air China are young and pretty, obviously a proven branding campaign for generations. However, just like all flight attendants everywhere, they were over-worked, harassed, and annoyed. Rolling their eyes seemed to be a primary job requirement. Yet, they seem to have more authority than U.S. travelers normally see. When they tell you to close the window, it is not a request.…

A Troubled Economic Paradise

In 1987, I made my last trip to China. Mao had only been dead 11 years, and Deng was still trying to figure out how to use Soviet-style Five Year Plans to unleash the Chinese economy. To me at that time, it was a large, Second-World nation with an agrarian economy. My principle take-away was military, i.e., that China really could field a ten-million man…

More breadcrumbs leading to . . .

Yesterday, it was announced that wholesale inventory levels rose 1.3%, which is the best performance in two years. Sometimes, a rise in inventory means sales have decreased, causing inventories to backing up. However, it was also announced that sales at the wholesale level increased twice as much as expected. This means wholesalers are re-stocking their inventories . . . because they have reason to believe…

Stealth Globalization

There is no good measure of globalization, a fact that drives economists crazy. Traditionally, we have used the Baltic Dry Index, which measures the cost of shipping dry goods around the world. It’s a good start, but here is another. Every three years, the Bank for International Settlements in Switzerland measures the volume of trading, not in stocks or bonds or commodities, but in currencies.…

A Good Morning, Indeed!

It’s nice to start the day with two pieces of good economic data. First, initial jobless claims dropped more than expected, down 27,000 to 451,000. That makes three jobless reports in a row that have been better than expected. It certainly smells like a bottom in an awful jobs market. Second, the trade deficit shrank more than expected, from $49.8 billion last month to $42.8…

Economic Rolaids

The Market has been holding its breath, fearful of today’s Jobs Report. Coming just before Labor Day, it seemed to be even more important than usual. Hopes started to rise Wednesday when the ISM (Institute of Supply Managment) manufacturing index actually rose more than expected. Still, most economists were expecting that the U.S. economy had lost about 110 thousand non-farm jobs last month, for the…

Did Anybody Notice?

In 1988, I took my daughter to Cozumel to scuba dive. While there, I spent some time on the beach reading a book whose name I no longer recall. What I do recall is its strident insistence that stock analysts pay much more attention to the “P/E Ratio” or Price-earnings ratio. This is a measure of how much investors are willing to pay for a…

The Way It Should Be!

Late last night, I returned from board meetings in Chicago of the National Association of Personal Financial Advisors (NAPFA). Like any board of any national organization, they were grappling with all the normal issues, such as budgets during the tough times. But, no matter the issue, the focus always remained on what was both fair and best for “people”. Occasionally, someone would use the word…